Fixed and do not change. A variable cost changes.
Fixed costs are things like rent, salaries, or any other cost that does not change over time.
Fixed costs are assigned to all products. Variable costs are assigned only to the product that led to the cost.
Those are Fixed Cost - costs which must be paid for any output level (sunk costs)
Avoidable Cost = These are those costs which can be avoidable by doing or not doing any particular activity For Example :Direct CostsUnavoidable Costs = These are those costs which are not avoidable whether do or donot initiate any activity For example: Fixed CostBut sometimes fixed costs are also avoidable or unavoidable by doing or not doing any activity in these cases fixed costs are also avoidable costs.
Avoidable or escapable costs are those costs which can be avoided by stop doing or start doing any particular activity and unavoidable costs are those costs which cannot be avoidable whether activity is done or not.For Example all variable costs are avoidable costs and fixed costs are unavoidable costs but this is general criteria to explain but not always all fixed costs are unavoidable.
what does fixed costs mean
Fixed costs are considered capacity costs because if a company expands, fixed costs will change. Additionally, if a company adds more resources, fixed costs will change.
Generally variable costs are relevant costs but if due to any decision fixed costs are also going to affected then fixed costs are also relevant costs.
Those costs which used in business for more than one fiscal year treated as fixed assets.
Yes. Variable costs are those that respond directly and proportionately to changes in activity level or volume, such as raw materials, hourly wages and commissions, utilities, inventory, office supplies, and packaging, mailing, and shipping costs. Since advertising does not, it is fixed. Some fixed costs are at the discretion of management, meaning business will not stop if you do not incur these costs (though it may suffer). Such costs include advertising. Other fixed costs are not avoidable, such as electricity.
Yes normally fixed costs are period costs because these costs have to be paid no matter production done or not.
Fixed costs are those expenses that do not change in proportion to the activity within the relevant period. And variable costs are costs that can be varied flexibly as the conditions change. So your personal fixed cost could be the fix line rent that you pay for the cell phone or the admission fee of your school. The variable costs could be your monthly shopping, tuition fees that depends on the courses etc.
When fixed costs decrease, what does this do for sales?