Total mixed costs
fixed costs + (variable cost per unit * unit sales)
Total costs
fixed costs + (variable cost per unit * unit sales)
Total fixed costs for the year
fixed costs per month *12 months
Total variable costs
total mixed costs - total fixed costs
Regression analysis
difference in distances of the data points from the line is minimized
Cost
reduction of an asset, for increasing revenues
Fixed costs
remain constant in the short run
Examples of fixed costs
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Avoidable costs
fixed costs that may be avoided when a company shuts down
Capacity fixed costs
ability to provide goods & services
Discretionary fixed costs
managers choose to avoid during the short run, to meet a budget
Examples of discretionary fixed costs
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Variable costs
change proportionally with the volume of business
Step costs
constant within a range of activity but different among ranges of activity