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Fixed Cost:
Fixed cost is the cost that remains the same or constant throughout a particular period and does not vary over time. For example, Rent paid for a building, administration fees.
Variable Cost:
Variable cost is that cost that varies over a period of time depending upon the quantity produced. For example, raw material and labor.
Direct cost:
Direct costs are the cost that are directly associated or related with the production and manufacturing activities of a business. For example,
Indirect Cost:
Indirect costs are the costs that are not directly associated with production activities of a business such as advertisements.
To Classify: Each cost as fixed or variable and direct or indirect cost.
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Chapter 14 Solutions
FIN & MANAGERIAL ACCT VOL 2 W/CONNECT
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
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