What is variable cost?

variable cost  Variable costs are the costs a company incurs proportionately to production quantity or revenue, including any costs that fluctuate  Variable costs are costs which change with output As output increases the firm needs to use more raw materials and employ more workers

If sales or production fall, then those costs can also fall The easiest way to determine if a cost is variable, therefore, is to work out if Fixed costs remain constant They do not change and describe the business's financial scenario In contrast, variable costs keep changing

What is the variable cost definition? The opposite of a fixed cost, a variable cost is an expense that fluctuates depending on the number of A variable cost is a cost that changes with the level of output or production In other words, it is a cost that increases as production increases and decreases