Question

Holly's day care has been in operation for several years. Identify each cost as variable (v), fixed (f), or mixed (m), relative to the number of students enrolled.

Answer 1

Holly's day care costs can be identified as variable (v), fixed (f), or mixed (m) costs depending on their relation to the number of students enrolled.

Step-by-step explanation:

The costs of Holly's day care can be categorized into variable (v), fixed (f), or mixed (m) costs, depending on their relation to the number of students enrolled.

• Variable costs change in direct proportion to the number of students enrolled. Examples of variable costs in a day care could include the cost of meals, supplies, or additional staff hired as the number of students increases.
• Fixed costs remain unchanged regardless of the number of students. Examples of fixed costs in a day care could include rent, utilities, or administrative salaries.
• Mixed costs have both variable and fixed components. An example of a mixed cost in a day care could be the salaries of teachers. There may be a fixed component, such as a base salary, and a variable component, such as bonuses based on the number of students.

By identifying each cost as variable, fixed, or mixed, Holly's day care can better manage and plan its expenses based on the number of students enrolled.