Question

Which of the following costs is not a controllable cost for the production manager: utility cost....

Which of the following costs is not a controllable cost for the production

manager:

utility cost.

repairs and maintenance on production equipment.

Insurance on the factory building.

Scrap and spoiled goods.
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Answer #1

Answer : Option C : Insurance on factory building.

Explanation : Insurance on factory building is fixed expense , at any level of production fixed expense will be same, production manager is concerned with the costs related to the production of goods.

Reasons for other options incorrect :

Option A : Utility costs can be minimised by using them efficiently.

Option B : Repairs and maintenance of Equipment can be reduced by maintaining equipment in good condition.

Option D : Scrap and spoiled goods can be reduced by purchasing good quality raw material.

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