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variable cost
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   Also found in: Dictionary/thesaurus, Financial, Wikipedia 0.01 sec.

variable cost

Cost of production materials, fuel, and so on which varies directly with the volume of output. For example, steel is a direct cost for a car manufacturer because if twice the number of cars are produced, twice the amount of steel will be used in the production process.



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After all, it can be accomplished with just three data elements: Actual or Projected Sales, Total Fixed Costs, and Total Variable Costs.
You have been asked to provide calculations of total variable costs for a contract for one of its products, based on the following alternative situations: 1 A contract for one order of 600 units.
The group's total variable costs are $1 million per year, while the division's variable costs are $500,000 per year.
 
 
 
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