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Explain variable cost and fixed cost
Variable costs: costs that vary almost in the direct proportion to the volume of production are known as variable costs. The examples of such costs are direct material, direct labour and indirect chargeable expenses, such as electric power, fuel etc.
Fixed costs: costs which do not vary with the level of production are called as fixed costs. These costs are called fixed because these remain constant irrespective of the level of output. It must, though, be noted that fixed costs do not remain constant for all times. In fact, it in the long run all costs have a tendency to vary. Fixed costs remain fixed up to a certain level of production.
discuss which of the cost classification is suitable for LunchBreak LTD and why?
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Seasonal Variations : Commodities along with seasonal demand results in raised level of working capital requirement. It could be offset through scaling down operations throughout t
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