Fixed costs are costs that remain constant as the volume of production increases or decreases.
Fixed costs remain the same, whether or not production increases or decreases. Wages paid to employees for their ordinary hours are a fixed price. Any greater time they spend on the job is a variable price.
Companies incur kinds of production charges: variable and glued expenses. Variable costs change based totally on the quantity of output produced. Variable charges may additionally consist of labor, commissions, and raw materials. Fixed charges stay identical regardless of manufacturing output.
Yes, depreciation is a set value. It is a habitual value that is commonly the identical quantity every duration, in step with Accounting gear. Depreciation isn't typically affected by output. Buildings and equipment depreciate in value.
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