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Two costs at Bradshaw Company appear below for specific months of operation. Month Amount Units Produced...

Two costs at Bradshaw Company appear below for specific months of operation. Month Amount Units Produced Delivery costs September $ 40,000 40,000 October 55,000 60,000 Utilities September $ 84,000 40,000 October 126,000 60,000

Which type of costs are these?

Delivery costs and utilities are both variable.

Delivery costs and utilities are both mixed.

Utilities are mixed and delivery costs are variable.

Delivery costs are mixed and utilities are variable.

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Homework Answers

Answer #1
Delivery costs:
Per unit costs in September 1.00 =40000/40000
Per unit costs in October 0.92 =55000/60000
Utilities:
Per unit costs in September 2.10 =84000/40000
Per unit costs in October 2.10 =126000/60000
Delivery costs differ in per unit as well in total over two months. Delivery costs would be classified as Mixed costs
Utilities cost per unit are same for both months. Utilities cost are variable costs, which are per unit constant but change in total.
Delivery costs are mixed and utilities are variable.
Option D is correct
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