Final answer:
The head of the production department can control costs related to raw materials, electricity for machinery, and direct labor, which are variable and closely tied to actual production activities. Other costs such as machinery depreciation and the price paid for materials are usually fixed and not directly controllable by the production department.
Step-by-step explanation:
The head of the production department can likely control certain costs, which are variable in nature and are directly related to the production activity. These costs include:
- Raw materials used: The quantity of raw materials can be managed based on production requirements.
- Electricity used for machinery: Careful scheduling and maintenance can manage electricity consumption.
- Direct labour: Labour hours and productivity relate directly to the output and can be controlled through efficient workforce management.
Other costs, such as the price paid for materials, charge for floor space, machinery depreciation, insurance on machinery, and the share of the cost of industrial relations department, are usually fixed or predetermined and not easily influenced by the department head. For instance, machinery depreciation is a systematic allocation of the cost over the useful life, and the price paid for materials might be determined by contracts or market prices beyond the production department's immediate control.