What are examples of fixed and variable cost in Home Depot?

Answer 1

I would say that most of the costs at theHome Depotare variable. I worked for Home Depot and much of the costs change as the companies output does. Many of the expenses vary based on production volumes. As many know, there are many contractors that work for the company, which include costs such as materials and labor, while many of the Home Depots functionality greatly depends on delivery costs as well as utilities although I do have to say, the company probably pays a great deal in utilities such as electricity and water due to the lighting section as well as the Garden area where they definitely don't skimp on the water used for the plants.

Also important to note, static expenses do not fluctuate with output volume and become increasingly smaller per unit of output as volume increases. Variable costs include the costs that fluctuate in direct proportion to the volume of units produced. Some example are the physical costs of goods sold, direct costs, such as materials, products purchased for resale, production costs, overhead, and etcetera. Unit price is the average revenue per unit of sales. In fact, the formula for the "break-even point in sales amount" is Fixed Costs divided by one minus the Unit Variable Cost divided by the Unit Price.

On the other hand, many costs are also fixed, although I wouldn't say as much as they are variable, if you think about it. It must be quite a bit for the lot as the building occupies a great deal of square footage, the store I worked at was pretty big (it took almost ten minutes to get across the entire store!). Many of the fixed costs result from expenses such as spending or consuming; disbursement, expenditure that are important to business accounting as the expenses are deductible against taxable income. Common expenses include rent, salaries, marketing, advertising, and travel. The marketing strategy follow the four P’s: product, price, place, and promotion.

I guess you can say it is a combination of both although I would say, more variable then fixed.