1. Cost of cloth
  2. Piece wages paid to workers
  3. Depreciation on machines owing to time
  4. Cost of electricity for running machines
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1 Answers

Answer: Option 3

Depreciation on machines owing to time is considered as fixed cost. Depreciation is a fixed cost, because it recurs in the same amount per period throughout the useful life of an asset. Depreciation cannot be considered a variable cost, since it does not vary with activity volume. However, there is an exception.

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