What are the two largest Fixed Costs typically incurred by businesses?

The two largest fixed costs typically incurred by businesses are rent and depreciation. Rent represents a consistent monthly expense for the physical space needed to operate the business, whether it's an office, retail store, or production facility. It remains unchanged regardless of the level of production or sales, making it a classic example of a fixed cost.

Depreciation relates to the gradual decrease in value of tangible fixed assets such as buildings, machinery, and equipment over time. This cost is accounted for on financial statements and is spread out over the useful life of the asset, meaning it remains constant from month to month, independent of the company’s revenues.

Both of these costs are essential for maintaining operations and are incurred even if the business does not generate any sales during a given period, thereby solidifying their distinction as fixed costs. The other options presented contain costs that can fluctuate based on various factors or are not typically classified as fixed in the same way.