variable cost

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Variable cost

A cost that is directly proportional to the volume of output produced. When production is zero, the variable cost is equal to zero.

Variable Cost

A cost to a person or business that varies over time according to a number of factors. For example, a dental office must buy dental supplies, which usually cost about the same. This is a fixed cost. On the other hand, the dental office must also pay the electric and gas and water bills, which may fluctuate considerably. This is a variable cost.

variable cost

The costs of production that vary directly in proportion to the number of units produced. Variable costs often include labor expenses and raw material costs, because labor and raw material usually must be increased to increase output. Firms for which variable costs represent a high proportion of total costs are usually less likely to experience large fluctuations in earnings, because changes in sales and revenues are accompanied by nearly equal changes in costs. Compare fixed cost.
References in periodicals archive ?
Many other types of variable expenses can abate, depending on the severity of the loss and may include utilities, business personal property and real property taxes, advertising, shipping costs, depreciation on destroyed business property, payroll and more.
Those who have not yet thrown in the towel generally decide to address their challenge in one of three ways: Do nothing, discount goods and services and or trim variable expenses or restructure their fixed expenses.
Hence, an expenditure whose benefit extends beyond one year is still seen as a variable expense in this example.
Accordingly, the adoption of strategies that enable the organization to transform fixed costs into variable expenses by adjusting resource consumption in response to variation in volume may increase profitability, improve the net cash flow derived from operations and reduce the fiscal risks that are attributable to operating leverage.
All we need to do is to build into the system a capacity to distinguish between the two types of variable expense just discussed--the time-variable expenses, as they might be called, and the output-variable expenses.
Month to month, the department manager must concentrate solely on the variable expense budget and not concern himself with the fixed expenses.
For example, the variable expense for a towel used in a wet cut is $.
The immediate attention of the company is on headcount reductions, slowing the pace of investments in its IP portfolio and driving out all excess variable expense items.
WhiteGlove turns an unpredictable, variable expense for both employers and employees/dependents into an affordable, fixed cost.
And, because eGistics DMP solution is built on the company's hosted platform, it requires no capital investment and offers a variable expense, "pay-as-you-go" pricing model.
In addition, because eGistics DMP solution is built on the company's hosted document management platform, it requires no capital investment and offers a variable expense, "pay-as-you-go" pricing model.

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