Identifying variable, fixed, and mixed costs

Identifying variable, fixed, and mixed costs

Holly’s Day Care has been in operation for several years. Identify each cost as a variable (V), fixed (F), or mixed (M), relative to the number of students enrolled.

Building rent.

Toys.

Compensation of the office manager, who receives a salary plus a bonus based on the number of students enrolled.

Afternoon snacks.

Lawn service contract at $200 per month.

Holly’s salary.

Wages of afterschool employees.

Drawing paper for student artwork.

Straight-line depreciation on furniture and playground equipment.

The fee paid to a security company for monthly service.