| Indirect Cost |
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Information AboutIndirect Cost |
| CATEGORIES ABOUT FIXED COST | |
| costs | |
| management accounting | |
| economics of production | |
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''Variable costs'' by contrast change in direct proportion to the activity of a business such as sales or production volume. In retail the ''cost of goods'' is almost entirely variable. In manufacturing, direct material costs are an example of a variable cost. Along with Variable Costs , fixed costs make up one of the two components of Total Cost . Unit fixed costs decline along with volume, following a rectangular hyperbola. As a result, the total unit cost of a product will decline as volume increases. Product costs, therefore, are always a function of volume. Fix costs should not be confused with Sunk Cost s. SEE ALSO |
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