Select Cost Information for Klondike Corporation Is as Follows Based on This Information:
A) Both Direct Materials and Rent

Multiple Choice

Select cost information for Klondike Corporation is as follows: $\begin{array} { l c c c c c } & 1,000 \text { units of output } && { 2,000 \text { units of output } } \\& \text { Total } & \text { Cost/Unit } & \text { Total } & \text { Cost/Unit } \\\text { Direct materials } & \$ 4,000 & \$ 4.00 & \$ 8,000 & \$ 4.00 \\\text { Rent expense } & \$ 2,000 & \$ 2.00 & \$ 2,000 & \$ 1.00\end{array}$
Based on this information:

A) Both direct materials and rent expense are fixed costs.
B) Direct materials is a fixed cost and rent expense is a variable cost.
C) Both direct materials and rent expense are mixed costs.
D) Both direct materials and rent expense are variable costs.
E) Direct materials is a variable cost and rent expense is a fixed cost.