Fixed charges for a chemical plant does not include the____________________?
Correct answer: D. Repair and maintenance charges
- A. Interest on borrowed money
- B. Rent of land and buildings
- C. Property tax, insurance and depreciation
- D. Repair and maintenance charges
Explanation
Fixed charges include items such as interest, rent, taxes, insurance, and depreciation, which do not vary directly with production rate. Repair and maintenance are normally treated as operating or manufacturing costs rather than fixed charges.
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