Within a relevant range and specified time period, the total variable costs vary directly (in proportion) to the change in activity level. The cost per unit is constant.For example: ABC Company spends $2.50 materials cost for every unit of Product A. If the company produces 1,000 units, ...
Below is an example of a firm's cost schedule and a graph of the fixed and variable costs. Noticed that the fixed cost curve is flat and the variable cost curve has a constant upward slope. Other sites in the eonor.com llc network: Aircraft Videos | Hiking | Book Club | Marathons ...
Step 1. Plot the data points for each period on a graph.This step requires that each data point be plotted on a graph. The x-axis (horizontal axis) reflects the level of activity (units produced in this example), and the y-axis (vertical axis) ref...
5.Draw a graph that includes average total cost, average fixed cost, average variable cost, and marginal cost. There are 2 steps to solve this one.
Fixed vs. Variable Costs Fixed Cost Graph The graph above depicts the company’s total indirect costs, which are expenses that do not vary with production or sales volume, such as rent, property taxes, and interest on the debt. The vertical axis represents the costs (in millions), while th...
Answer to: The sum of fixed cost and variable cost at any rate of output is equal to: a. Average total cost. b. Total profit. c. Total cost. d...
are costs which do not change with change in output as long as the production is within the relevant range. It is the cost which is incurred even when output is zero. Fixed cost, variable cost and mixed cost are three classes into which costs are classified based on their behavior. A va...
18.3.1 Cost classification on the basis of behaviour The cost is classified as fixed or variable according to the behavioural aspect. The total cost in garment manufacturing on the basis of behaviour is thus the sum of fixed cost and variable cost. Fixed cost remains unchanged, irrespective of...
Variable costs are costs that remain the same per unit at every level of activity. a. True. b. False. Fixed costs are constant on both the total cost and per-unit cost basis. (a) True (b) False. True or false: Relevant range is the range of activity...
production increases in direct proportion at the constant rate of Rs 50 per unit. The variable cost line is shown as linear rather than curvilinear. That is, on a graph paper, a variable cost line appears as unbroken straight line in place of a curve. Variable cost per unit is shown by...