Which of the following are variable costs?

Which of the following are variable costs?
A . Rent
B . Loan repayments
C . Insurance
D . Packaging

View Answer

Answer: D

Explanation:

Packaging is considered a variable cost because it fluctuates with the level of production or sales activity. Variable costs change directly in relation to the volume of output or service.

In contrast:

Rent (A), Loan repayments (B), and Insurance (C) are fixed costs, as they generally do not vary with production levels within a certain range. These are recurring costs that remain constant over time, aligning with CIPS’s cost classification in procurement.