It is impossible for companies to carry out any activity without investing costs in the process of making a profit.

However, there are costs different types. Some operations during the operation of the enterprise require constant investments.

But there are also costs that are not fixed costs, i.e. refer to variables. How do they affect the production and sale of finished products?

The concept of fixed and variable costs and their differences

The main goal of the enterprise is the manufacture and sale of manufactured products to make a profit.

To produce products or provide services, you must first purchase materials, tools, machines, hire people, etc. This requires an investment of various amounts. Money, which are called “costs” in economics.

Since monetary investments in production processes come in many different types, they are classified depending on the purpose of using the expenses.

In economics costs are shared according to the following properties:

1. Explicit is a type of direct cash costs for making payments, commission payments to trading companies, payment for banking services, transportation costs, etc.;
2. Implicit, which includes the cost of using the resources of the organization's owners, not provided for by contractual obligations for explicit payment.
3. Fixed investments are investments to ensure stable costs during the production process.
4. Variables are special costs that can be easily adjusted without affecting operations depending on changes in production volumes.
5. Irrevocable – special option spending movable assets invested in production without return. These types of expenses occur at the beginning of the release of new products or reorientation of the enterprise. Once spent, funds can no longer be used to invest in other business processes.
6. Average is the estimated cost that determines the amount of capital investment per unit of output. Based on this value, it is formed piece price products.
7. Marginal is the maximum amount of costs that cannot be increased due to the ineffectiveness of further investments in production.
8. Returns are the costs of delivering products to the buyer.

Of this list of costs, the most important are their fixed and variable types. Let's take a closer look at what they consist of.

Kinds

What should be classified as fixed and variable costs? There are some principles by which they differ from each other.

In economics characterize them as follows:

• Fixed costs include the costs that need to be invested in the manufacture of products within one production cycle. For each enterprise they are individual, therefore they are taken into account by the organization independently based on analysis production processes. It should be noted that these costs will be characteristic and the same in each of the cycles during the manufacture of goods from the beginning to the sale of products.
• variable costs that can change in each production cycle and are almost never repeated.

Fixed and variable costs make up the total costs, summed up after the end of one production cycle.

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What applies to them

The main characteristic of fixed costs is that they do not actually change over a period of time.

In this case, for an enterprise that decides to increase or decrease its output, such costs will remain unchanged.

Among them can be attributed the following cash costs:

• communal payments;
• building maintenance costs;
• rent;
• employee earnings, etc.

In this situation, you always need to understand that the constant amount of total costs invested in a certain period of time to produce products in one cycle will only be for the entire number of products produced. When calculating such costs individually, their value will decrease in direct proportion to the increase in production volumes. For all types of production this pattern is an established fact.

Variable costs depend on changes in the quantity or volume of products produced.

To them include the following expenses:

• energy costs;
• raw materials;
• piecework wages.

These monetary investments are directly related to production volumes, and therefore change depending on the planned parameters of production.

Examples

In each production cycle there are cost amounts that do not change under any circumstances. But there are also costs that depend on production factors. Depending on such characteristics, economic costs for a certain, short period of time are called constant or variable.

For long-term planning, such characteristics are not relevant, because sooner or later all costs tend to change.

Fixed costs are costs that do not depend in the short term on how much the company produces. It is worth noting that they represent the costs of its constant factors of production, independent of the number of goods produced.

Depending on the type of production into fixed costs consumables include:

Any costs that are not related to production and are the same in the short term of the production cycle can be included in fixed costs. According to this definition, it can be stated that variable costs are those expenses invested directly in product output. Their value always depends on the volume of products or services produced.

Direct investment of assets depends on the planned quantity of production.

Based on this characteristic, to variable costs The following costs include:

• raw material reserves;
• payment of remuneration for the labor of workers involved in the manufacture of products;
• delivery of raw materials and products;
• energy resources;
• tools and materials;
• other direct costs of producing products or providing services.

The graphical representation of variable costs displays a wavy line that smoothly rises upward. Moreover, with an increase in production volumes, it initially rises in proportion to the increase in the number of products produced, until it reaches point “A”.

Then cost savings occur during mass production, and therefore the line rushes upward at no less speed (section “A-B”). After the violation of the optimal expenditure of funds in variable costs after point “B”, the line again takes a more vertical position.
The growth of variable costs can be influenced by the irrational use of funds for transport needs or excessive accumulation of raw materials and volumes of finished products during a decrease in consumer demand.

Calculation procedure

Let's give an example of calculating fixed and variable costs. The production is engaged in the manufacture of shoes. The annual production volume is 2000 pairs of boots.

The enterprise has the following types of expenses per calendar year:

1. Payment for renting the premises in the amount of 25,000 rubles.
2. Interest payment 11,000 rubles. for a loan.

Production costs goods:

• for labor costs for the production of 1 pair 20 rubles.
• for raw materials and materials 12 rubles.

It is necessary to determine the size of total, fixed and variable costs, as well as how much money is spent on making 1 pair of shoes.

As we can see from the example, only rent and interest on the loan can be considered fixed or constant costs.

Due to fixed costs do not change their value when production volumes change, then they will amount to the following amount:

25000+11000=36000 rubles.

The cost of making 1 pair of shoes is considered a variable cost. For 1 pair of shoes total costs amount to the following:

20+12= 32 rubles.

Per year with the release of 2000 pairs variable costs in total are:

32x2000=64000 rubles.

Total costs are calculated as the sum of fixed and variable costs:

36000+64000=100000 rubles.

Let's define average of total costs, which the company spends on sewing one pair of boots:

100000/2000=50 rubles.

Cost analysis and planning

Each enterprise must calculate, analyze and plan costs for production activities.

Analyzing the amount of expenses, options for saving funds invested in production are considered in order to rational use. This allows the company to reduce production and, accordingly, set a cheaper price for finished products. Such actions, in turn, allow the company to successfully compete in the market and ensure constant growth.

Any enterprise should strive to save production costs and optimize all processes. The success of the development of the enterprise depends on this. Thanks to the reduction in costs, the company's income increases significantly, which makes it possible to successfully invest money in the development of production.

Costs are planned taking into account calculations of previous periods. Depending on the volume of products produced, an increase or decrease in variable costs for the manufacture of products is planned.

Display in the balance sheet

In the financial statements, all information about the costs of the enterprise is entered into (Form No. 2).

Preliminary calculations during the preparation of indicators for entry can be divided into direct and indirect costs. If these values ​​are shown separately, then we can assume that indirect costs will be indicators of fixed costs, and direct costs will be variable, respectively.

It is worth considering that the balance sheet does not contain data on costs, since it reflects only assets and liabilities, and not expenses and income.

To learn what fixed and variable costs are and what applies to them, see the following video:

The size of which depends on the intensity of production. Variable costs are the opposite fixed costs. The key feature by which variable costs are identified is their disappearance when production is suspended.

What are variable costs?

Variable costs include the following:

• Piece-rate wages for workers tied to personal results.

• Expenses for the purchase of raw materials and components for production maintenance.

• Interest and bonuses paid to consultants and sales managers based on the results of plan implementation.

• The amount of taxes based on production and sales volumes. These are the following taxes: VAT, excise taxes, according to the simplified tax system.

• Expenses for paying for the services of service organizations, for example, goods transportation services or sales outsourcing.

• The cost of fuel and electricity consumed directly in the workshops. An important distinction is made here: energy used in administrative buildings and offices is a fixed cost.

Break-even point and types of variable costs

The value of VC varies in proportion to the size of total costs. When determining the break-even point, it is assumed that variable costs are proportional to production volume:

However, this is not always the case. An exception may be, for example, the introduction night shift. Since the night is higher, variable costs will increase at a greater rate than production volumes. Based on this feature, there are three types of VC:

• Proportional.

• Regressive variable - costs increase at a slower rate than. This effect is known as “economy of scale.”

• Progressive-variable - the rate of cost growth is higher.

Calculation of VC indicator

The classification of costs into fixed and variable is not used at all for accounting(there is no line “variable costs” in the balance sheet), but for management analysis. Calculation of variable costs is advisable because it gives the manager the opportunity to manage the profitability and profitability of the organization.

To determine the value of variable costs, methods such as algebraic, statistical, graphical, regression-correlation and others are used. The most famous and widespread is the algebraic method, according to which the following formula can be used to determine the value of VC:

Algebraic analysis assumes that the subject of the study has such information as the volume of production in physical terms (X) and the size of the corresponding costs (Z) for at least two points of production.

Also often used margin method, based on the definition of magnitude marginal income, which is the difference between the organization's profit and total variable costs.

Breaking point: how to minimize variable costs?

A popular strategy for minimizing variable costs is to determine " points fracture" - such a volume of production at which variable costs stop increasing proportionally and reduce the growth rate:

There may be several reasons for this effect. Among them:

1. 1. Reducing labor costs for management personnel.

1. 2. Application of a focusing strategy, which consists of increasing the specialization of production.

1. 4. Integration innovative developments into the production process.

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Probably every person who has worked for the “owner” for at least one day wants to start own business and be your own boss. But in order to open your own business that will bring good income, you need to correctly set up a financial model economic activity.

Financial model of the enterprise

Why is this necessary? In order to have a correct idea of ​​future income, what level the enterprise’s fixed and variable expenses will have, to understand where it will need to go and what financial policy to use when making decisions.

Basis of construction successful business is its commercial component. According to economic theory, money is goods that can and should generate new goods. If you start your own business, you need to understand that its profitability must come first, otherwise the person will engage in philanthropy.

You can't work at a loss

Profit is equal to the difference between income and costs, which are divided into fixed and variable expenses of the enterprise. When expenses are greater than income, profit turns into loss. The main task The goal of an entrepreneur is to ensure that the business generates maximum income with minimal use of available resources.

This means that you should always strive to sell as many goods or services as possible, while reducing the level of costs of the enterprise.

If everything is more or less clear with income (how much you produced, how much you sold), then with expenses it’s much more complicated. In this article we will look at fixed and variable costs, as well as how to optimize costs and find a middle ground.

In this article, expenses, costs and expenses, as well as in economic literature, will be used as synonymous words. So what types of costs are there?

Types of expenses

All enterprise costs can be divided into fixed and variable costs. This division allows for prompt budgeting and planning of the necessary resources to conduct the business of the enterprise.

Fixed costs are those costs whose level does not depend on the volume of products produced. That is, no matter how many units you produce, your fixed costs will not change.

Variable and semi-fixed costs have different effects on production activities. Why conditionally constant? Because not all types of expenses can be classified as constant, since they can change their properties and accounting procedures from time to time.

What do variable and fixed costs include?

For example, such expenses may include salaries of administrative and management personnel, but only if they receive money regardless of the financial results of the enterprise. Despite the fact that in the West managers have long been making money on their managerial and organizational skills, increasing their client base and expanding markets, in most enterprises Russian Federation heads of different structures receive a stable monthly salary without reference to work results.

This leads to the fact that a person simply has no incentive to improve anything in his work. Because of this, labor productivity is at a low level, and the desire to move forward to new technological processes is generally at zero.

Fixed expenses

In addition to management salaries, rental payments can be considered fixed expenses. Imagine that you are in the tourism business and you do not have your own premises.

In this case, you will be forced to pay someone to rent the commercial property. And no one is saying that this is the worst option. The cost of building your own office from scratch is very high and in many cases will not pay off even in 5-10 years if the business is small or middle class.

Therefore, many people prefer to take the necessary square meters as rent. And you can immediately guess that regardless of whether your business has gone well or you are in deep loss, the landlord will demand the monthly payment specified in the contract.

What could be more stable in accounting than paying wages? This is depreciation. Any fixed asset must be depreciated month after month until its initial cost is zero.

Methods for calculating depreciation may be different, but, of course, within the framework of the law. These monthly expenses are also considered fixed costs of the enterprise.

There are many more such examples: communication services, communications, waste removal or recycling, provision of necessary working conditions, etc. Their main feature is that they are easy to calculate both in the current period and in future ones.

Variable expenses

Such costs are those that vary in direct proportion to the volume of products produced or services provided.

For example, in the balance sheet there is such a line as raw materials and materials. They indicate the total cost of those funds that the enterprise needs for production activities.

Let's assume that to release one wooden box you need 2 square meters wood Accordingly, to create a batch of 100 such units of product you will need 200 sq.m of material. Therefore, such costs can be safely classified as variable.

Wages can relate not only to fixed, but also to variable expenses. This will happen in cases where:

• the changed volume of production requires a change in the number of employees employed in the manufacturing process;
• workers receive percentages that correspond to deviations in working standard production.

Under such circumstances, it is quite difficult to plan the amount of labor costs in the long term, since it will depend on at least two factors.

Also, in the process of production activities, fuel and various types of energy resources are consumed: light, gas, water. If all these resources are used directly in the manufacturing process (for example, the production of a car), then it would be logical that a large batch of products would require an increased amount of energy consumption.

Why do you need to know what fixed and variable costs exist?

Of course, such a classification of costs is needed to optimize the cost structure in order to increase profits. That is, you can immediately understand which costs you can save on, and which ones will exist in any case, and they can be reduced only by reducing the level of production. What does variable analysis look like? fixed costs?

Let's say you produce furniture at an industrial level. Your cost items are as follows:

• raw materials and materials;
• wage;
• depreciation;
• electricity, gas, water;
• other.

So far everything is easy and clear.

The first step is to divide all this into fixed and variable expenses.

Permanent:

1. Salaries of directors, accountants, economists, lawyers.
2. Depreciation deductions.
3. Used electrical energy for lighting.

The variables include the following.

1. Wages of workers, the standardized number of which depends on the volume of furniture produced (one or two shifts, the number of people in one assembly box, etc.).
2. Raw materials and supplies necessary to produce one unit of product (wood, metal, fabric, bolts, nuts, screws, etc.).
3. Gas or electricity, if these resources are consumed directly for the manufacture of furniture. For example, this is the electricity consumption of various furniture assembly machines.

Impact of expenses on production costs

So, you have listed all the expenses of your business. Now let's see what role fixed and variable costs play in cost. It is necessary to go through all the fixed costs and see how the structure of the enterprise can be optimized so that less management personnel are involved in production during the production process.

The breakdown of fixed and variable expenses above shows where to start. You can save on energy resources either by switching to alternative sources, or during modernization, in order to increase the level of equipment efficiency.

After this, it’s worth going through all the variable costs, tracking which of them depend more or less on external factors, and which ones can be counted with confidence.

Once you understand the cost structure, you can easily transform any business to suit the needs and requirements of any owner and his strategic plans.

If your goal is to reduce product costs in order to win several positions in the sales market, then you should pay more attention to variable costs.

Of course, as soon as you understand what constitutes fixed and variable expenses, you will be able to easily navigate and quickly understand where you need to “tuck your tails between your legs” and where you can “loose your belts.”

Let's consider the variable costs of an enterprise, what they include, how they are calculated and determined in practice, consider methods for analyzing the variable costs of an enterprise, the effect of changing variable costs when various volumes production and their economic meaning. In order to easily understand all this, an example of variable cost analysis based on the break-even point model is analyzed at the end.

Variable costs of the enterprise. Definition and their economic meaning

Variable costs of the enterprise (EnglishVariableCost,V.C.) are the costs of the enterprise/company, which vary depending on the volume of production/sales. All costs of an enterprise can be divided into two types: variable and fixed. Their main difference is that some change with increasing production volume, while others do not. If the company's production activities cease, then variable costs disappear and become equal to zero.

Variable costs include:

• The cost of raw materials, materials, fuel, electricity and other resources involved in production activities.
• Cost of manufactured products.
• Wages of working personnel (part of the salary depends on the standards met).
• Percentages on sales to sales managers and other bonuses. Interest paid to outsourcing companies.
• Taxes that have a tax base based on the size of sales and sales: excise taxes, VAT, unified tax on premiums, tax according to the simplified tax system.

What is the purpose of calculating the variable costs of an enterprise?

Behind any economic indicator, coefficient and concept one should see their economic meaning and the purpose of their use. If we talk about the economic goals of any enterprise/company, then there are only two of them: either increasing income or reducing costs. If we summarize these two goals into one indicator, we get the profitability/profitability of the enterprise. The higher the profitability/profitability of an enterprise, the greater its financial reliability, more opportunity attract additional borrowed capital, expand its production and technical capacities, increase intellectual capital, increase its value in the market and investment attractiveness.

The classification of enterprise costs into fixed and variable is used for management accounting, and not for accounting. As a result, there is no such item as “variable costs” in the balance sheet.

Determining the size of variable costs in general structure of all enterprise costs allows you to analyze and consider various management strategies for increasing the profitability of the enterprise.

Amendments to the definition of variable costs

When we introduced the definition of variable costs/costs, we were based on a model of linear dependence of variable costs and production volume. In practice, variable costs often do not always depend on the size of sales and output, so they are called conditionally variable (for example, the introduction of automation of part of the production functions and, as a result, a reduction in wages for the production rate of production personnel).

The situation is similar with fixed costs; in reality, they are also semi-fixed and can change with production growth (increasing rent for industrial premises, changes in the number of personnel and the consequence of wages. You can read more about fixed costs in my article: “”.

Classification of enterprise variable costs

In order to better understand how to understand what variable costs are, consider the classification of variable costs according to various criteria:

Depending on the size of sales and production:

• Proportional costs. Elasticity coefficient =1. Variable costs increase in direct proportion to the growth of production volume. For example, production volume increased by 30% and costs also increased by 30%.
• Progressive costs (analogous to progressive-variable costs). Elasticity coefficient >1. Variable costs have a high sensitivity to change depending on the size of output. That is, variable costs increase relatively more with production volume. For example, production volume increased by 30% and costs by 50%.
• Degressive costs (analogous to regressive-variable costs). Elasticity coefficient< 1. При увеличении роста производства переменные издержки предприятия уменьшаются. Данный эффект получил название – «эффект масштаба» или «эффект массового производства». Так, например, объем производства вырос на 30%, а при этом размер переменных издержек увеличился только на 15%.

The table shows an example of changes in production volume and the size of variable costs for their various types.

According to statistical indicators, there are:

• Total variable costs ( EnglishTotalVariableCost,TVC) – include the totality of all variable costs of the enterprise for the entire range of products.
• Average Variable Cost (AVC) AverageVariableCost) – average variable costs per unit of product or group of goods.

According to the method of financial accounting and attribution to the cost of manufactured products:

• Variable direct costs are costs that can be attributed to the cost of goods manufactured. Everything is simple here, these are the costs of materials, fuel, energy, wages, etc.
• Variable indirect costs are costs that depend on the volume of production and it is difficult to assess their contribution to the cost of production. For example, during the industrial separation of milk into skim milk and cream. Determining the amount of costs in the cost price of skim milk and cream is problematic.

In relation to the production process:

• Production variable costs - costs of raw materials, supplies, fuel, energy, wages of workers, etc.
• Non-production variable costs are costs not directly related to production: commercial and administrative expenses, for example: transportation costs, commission to an intermediary/agent.

Formula for calculating variable costs/expenses

As a result, you can write a formula for calculating variable costs:

Variable costs = Costs of raw materials + Materials + Electricity + Fuel + Bonus part of salary + Interest on sales to agents;

Variable costs= Marginal (gross) profit – Fixed costs;

The totality of variable and fixed costs and fixed costs is total costs enterprises.

Total costs= Fixed costs + Variable costs.

The figure shows the graphical relationship between enterprise costs.

How to reduce variable costs?

One strategy for reducing variable costs is to use “economies of scale.” With an increase in production volume and the transition from serial to mass production, economies of scale appear.

Economies of scale graph shows that as production volume increases, a turning point is reached when the relationship between costs and production volume becomes nonlinear.

At the same time, the rate of change in variable costs is lower than the growth of production/sales. Let's consider the reasons for the appearance of the “production scale effect”:

1. Reducing management personnel costs.
2. Use of R&D in production. An increase in output and sales leads to the possibility of conducting expensive scientific research research work to improve production technology.
3. Narrow product specialization. Focusing the entire production complex on a number of tasks can improve their quality and reduce the amount of defects.
4. Production of products similar in the technological chain, additional capacity utilization.

Variable costs and break-even point. Example calculation in Excel

Let's consider the break-even point model and the role of variable costs. The figure below shows the relationship between changes in production volume and the size of variable, fixed and total costs. Variable costs are included in total costs and directly determine the break-even point. More

When the enterprise reaches a certain volume of production, an equilibrium point occurs at which the amount of profit and loss coincides, net profit in this case equals zero, and marginal profit equal to fixed costs. Such a point is called break-even point, and it shows the minimum critical level of production at which the enterprise is profitable. In the figure and calculation table presented below, 8 units are achieved by producing and selling. products.

The enterprise's task is to create security zone and ensure a level of sales and production that would ensure the maximum distance from the break-even point. The further an enterprise is from the break-even point, the higher the level of its financial stability, competitiveness and profitability.

Let's look at an example of what happens to the break-even point when variable costs increase. The table below shows an example of changes in all indicators of income and costs of an enterprise.

As variable costs increase, the break-even point shifts. The figure below shows a graph for achieving the break-even point in a situation where the variable costs of producing one unit of steel are not 50 rubles, but 60 rubles. As we can see, the break-even point became equal to 16 units of sales/sales or 960 rubles. income.

This model, as a rule, operates with linear relationships between production volume and income/costs. In real practice, dependencies are often nonlinear. This arises due to the fact that production/sales volume is influenced by: technology, seasonality of demand, influence of competitors, macroeconomic indicators, taxes, subsidies, economies of scale, etc. To ensure the accuracy of the model, it should be used in the short term for products with stable demand (consumption).

Summary

In this article, we examined various aspects of variable costs/costs of an enterprise, what forms them, what types of them exist, how changes in variable costs and changes in the break-even point are related. Variable costs are the most important indicator of an enterprise in management accounting, for creating planned tasks for departments and managers to find ways to reduce their weight in total costs. To reduce variable costs, production specialization can be increased; expand the range of products using the same production capacity; increase the share of scientific and production developments to improve efficiency and quality of output.

In the activities of any enterprise, making the right management decisions is based on an analysis of its performance indicators. One of the objectives of such analysis is to reduce production costs, and, consequently, increase business profitability.

Fixed and variable costs and their accounting are an integral part of not only calculating product costs, but also analyzing the success of the enterprise as a whole.

Correct analysis of these articles allows you to take effective management decisions that have a significant impact on profits. For analysis purposes in computer programs at enterprises it is convenient to provide for automatic allocation of costs into fixed and variable based on primary documents, in accordance with the principle adopted in the organization. This information is very important for determining the “break-even point” of a business, as well as assessing profitability various types products.

Variable costs

To variable costs These include costs that are constant per unit of production, but their total amount is proportional to the volume of output. These include the costs of raw materials, Consumables, energy resources involved in the main production, salaries of the main production personnel (together with accruals) and cost transport services. These costs are directly included in the cost of production. In monetary terms, variable costs change when the price of goods or services changes. Specific variable costs, for example, for raw materials in physical terms, can be reduced with an increase in production volumes due, for example, to a reduction in losses or costs for energy resources and transport.

Variable costs can be direct or indirect. If, for example, an enterprise produces bread, then the costs of flour are direct variable costs, which increase in direct proportion to the volume of bread production. Direct variable costs may decrease with the improvement of the technological process and the introduction of new technologies. However, if a plant processes oil and as a result receives one technological process, for example, gasoline, ethylene and fuel oil, then the cost of oil for the production of ethylene will be variable, but indirect. Indirect variable costs in this case, they are usually taken into account in proportion to the physical volumes of production. So, for example, if when processing 100 tons of oil, 50 tons of gasoline, 20 tons of fuel oil and 20 tons of ethylene are obtained (10 tons are losses or waste), then the cost of producing one ton of ethylene is 1.111 tons of oil (20 tons of ethylene + 2.22 tons of waste /20 t ethylene). This is due to the fact that, when calculated proportionally, 20 tons of ethylene produce 2.22 tons of waste. But sometimes all waste is attributed to one product. Data from technological regulations are used for calculations, and actual results for the previous period are used for analysis.

The division into direct and indirect variable costs is arbitrary and depends on the nature of the business.

Thus, the cost of gasoline for transporting raw materials during oil refining is indirect, and for transport company direct, since they are directly proportional to the volume of transportation. Wages production personnel with accruals are classified as variable costs for piecework wages. However, with time-based wages, these costs are conditionally variable. When calculating the cost of production, planned costs per unit of production are used, and when analyzing actual costs, which may differ from planned costs, both upward and downward. Depreciation of fixed assets of production per unit of production volume is also a variable cost. But this one relative value is used only when calculating the cost of various types of products, since depreciation charges, in themselves, are fixed costs/expenses.

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Thus, total variable expenses can be calculated using the formula:

Rperem = C + ZPP + E + TR + X,

C – costs of raw materials;

ZPP – salary of production personnel with deductions;

E – cost of energy resources;

TR – transport costs;

X – other variable expenses that depend on the company’s activity profile.

If an enterprise produces several types of products in quantities W1 ... Wn and per unit of production variable costs are P1 ... Pn, then the total variable costs will be:

Rvariable = W1P1 + W2P2 + … + WnPn

If an organization provides services and pays agents (for example, sales agents) as a percentage of sales volume, then remuneration to agents is considered a variable cost.

Fixed costs

Fixed production costs of an enterprise are those that do not change in proportion to the volume of production.

The share of fixed costs decreases with increasing production volume (scaling effect).

This effect is not inversely proportional to production volume. For example, an increase in production volume may require an increase in the number of accounting and sales departments. Therefore, they often talk about conditionally fixed costs. Fixed costs also include expenses for management personnel, maintenance of key production personnel (cleaning, security, laundry, etc.), organization of production (communications, advertising, bank expenses, travel expenses, etc.), as well as depreciation charges. Fixed expenses are expenses, for example, for renting premises, and the rental price may change due to changes in market conditions. Fixed costs include some taxes. These are, for example, the unified tax on imputed income (UTII) and property tax. The amounts of these taxes may change due to changes in the rates of such taxes. The amount of fixed costs can be calculated using the formula:

Рpost = Zaup + AR + AM + N + OR