Describe the cost formula for a strictly fixed cost

Reference no: EM131342490

1. Why do mixed costs pose a problem when it comes to classifying costs into fixed and variable categories?

2. Describe the cost formula for a strictly fixed cost such as depreciation of $15,000 per year.

3. Describe the cost formula for a strictly variable cost such as electrical power cost of $1.15 per machine hour (i.e., every hour the machinery is run, electrical power cost goes up by $1.15).

Reference no: EM131342490

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