Definition of Variable cost:
Variable costs can be compared to fixed costs.
Periodicals that vary according to the company's production or sales.
Variable costs include raw materials, energy consumption, labor, distribution costs, and so on. A high variable cost company is very different from a fixed cost company. These differences affect the financial structure of a company as well as its prices and profits. The break point for these companies (compared to companies with high fixed costs) is usually at a very low level of production, but their modest profit (participation rate) is also very low.
Variable costs are business costs that vary in proportion to production. Variable costs increase or decrease depending on the volume of production of the company, increase with increasing production and decrease with decreasing production. Examples of variable costs are raw material and packaging costs.
How to use Variable cost in a sentence?
- Some items may have a high variable cost. If the price is what you want, consider buying more.
- Some products may have high variable costs. So, if the price is right, you should try to charge a fee.
- Variable costs are business costs that vary in proportion to production.
- Variable costs depend on production.
- Variable costs can increase or decrease due to a number of factors, as opposed to fixed costs, which are simple or permanent.
- I want my client to know the variable cost component associated with the cost of owning this new asset.
Meaning of Variable cost & Variable cost Definition