Fixed Cost

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Description

A fixed cost is a cost that remains constant, in total, regardless of changes in the level of activity. Examples of fixed costs include straight-line depreciation, insurance, property taxes, rent, supervisory salaries, and advertising.

These costs do not vary with production or sales level.

Concept Prerequisite

Wikipedia Reference

http://en.wikipedia.org/wiki/Fixed cost

Learning Material

Covered in Topic(s)

 
Cost Terms Concepts and Classification
Pricing Strategies