What are Variable Costs? Examples include commission payments and overage charges. Semi-variable costs are also referred to as mixed costs or semi-fixed costs. The formula for total variable cost can be computed by using the following steps: You can categorize your business costs as fixed, variable and mixed based on how they change in response to your sales or production output. Examples include commission payments and overage charges. Qualitative Variable What are Examples of Variable Costs? Ingredients are the food items you use to make your baked goods and are the most easily identifiable variable costs. b = Variable cost per unit of activity x = Number of units of activity. The independent variable is the variable that is changed on purpose to test the dependent variable, while the control variable is the thing in an experiment that is unchanged and constant. The order of the categories is not significant, so marital status is a nominal variable. You can understand this with an example, i.e. Variable Cost Average Variable Cost refers to the variable cost of per unit of the goods or services where the variable cost is the cost that directly varies with respect to the output and is calculated by dividing the total variable cost during the period by the number of the units. Thus, the materials used as the components in a product are considered variable costs, because they vary directly with the number of units of … What are Variable Costs? As with personal budgets, the formula for calculating a business's total costs is quite simple: Fixed Costs + Variable Costs = Total Cost. Average Variable Cost refers to the variable cost of per unit of the goods or services where the variable cost is the cost that directly varies with respect to the output and is calculated by dividing the total variable cost during the period by the number of the units. Dependent Variable If a company owns a production line, the total cost of that equipment in a month is a semi-variable cost. In the above example, you can find your average variable cost by adding the total variable cost of Product A ($60 x 10 units, or $600) and the total variable cost of Product B ($30 x 15 units, or $450), then dividing this sum by the total number of units produced (10 + 15, or 25). Variable Cost In the simplest case, where cost is linear in output, the equation for the total semi-variable cost is as follows: = + where is the total cost, is the fixed cost, is the variable cost per unit, and is the number of units (i.e. Variable Cost Your average variable cost is ($600 + $450) ÷ 25, or $42 per unit. For example, an experimental change to a production line may be measured in terms of unit cost as the dependent variable. Fixed and variable costs also have a friend in common: Semi-variable costs, which share qualities of each. In that case, you need to have a decent idea of not only your fixed cost for the business, but what the variable cost for a new product might look like. Fixed cost vs variable cost is the difference in categorizing business costs as either static or fluctuating when there is a change in the activity and sales volume. In that case, you need to have a decent idea of not only your fixed cost for the business, but what the variable cost for a new product might look like. Variable expenses can be contrasted with overhead such as the cost of your HR team that doesn't change with your business volumes or strategy. You can understand this with an example, i.e. If a company owns a production line, the total cost of that equipment in a month is a semi-variable cost. Part of the cost stays consistent (often a base cost) and part fluctuates with business activity. Determining the variable costs involved in operating a business is essential to maintain efficiency and profitability. If the business produces 200 units, its variable cost would be $1,000. Commissions are a semi-variable labor costs. the output produced).. A variable cost is a cost that changes in relation to variations in an activity.In a business, the "activity" is frequently production volume, with sales volume being another likely triggering event. The accounting standards do not require that the fixed or variable nature of a cost be identified in a firm’s financial statements. Variable costs are expenses that change in proportion to the number of goods and services the business produces. Ingredients. The independent variable is the variable that is changed on purpose to test the dependent variable, while the control variable is the thing in an experiment that is unchanged and constant. It is sometimes not possible to classify a cost as either fixed or variable. Variable cost = Direct labor + 80% Utilities + Materials Variable cost = 40,00 + 80% x 22,000 + 35,000 Variable cost = 92,600 Variable Cost per Unit The variable cost per unit is calculated by dividing the total variable costs of the business by the number of units. b = Variable cost per unit of activity x = Number of units of activity. Some examples of cost objects are products, departments, customers, plant, a territory, a product line and research and development activities of the business etc. Some examples of cost objects are products, departments, customers, plant, a territory, a product line and research and development activities of the business etc. Variable costs are the sum of marginal costs over all units produced. What are Variable Costs? Your average variable cost is ($600 + $450) ÷ 25, or $42 per unit. Fixed Cost Examples. Explanation. Examples of Mixed Costs in Accounting. This could include things like research and development, new materials, packaging, shipping costs, as well as a commission for your salespeople, varying labor units, and more. Variable costs are the sum of marginal costs over all units produced. The formula for total variable cost can be computed by using the following steps: Variable expenses can be contrasted with overhead such as the cost of your HR team that doesn't change with your business volumes or strategy. A brief explanation of direct costs and indirect costs are given below: Direct cost: A cost that is easily traceable to a particular cost object is known as direct cost. Thus, the materials used as the components in a product are considered variable costs, because they vary directly with the number of units of … You can categorize your business costs as fixed, variable and mixed based on how they change in response to your sales or production output. Similarly, if it produces 1,000 hats, the variable cost would rise to $5,000. But if the company does not produce any hats, it will not incur any variable costs for the production of the hats. Variable expenses also include strategic initiatives such as a project that is expensed. Part of the cost stays consistent (often a base cost) and part fluctuates with business activity. Semi-variable costs consist of both fixed and variable costs. For example, an experimental change to a production line may be measured in terms of unit cost as the dependent variable. Classifying costs as either variable or fixed is important for companies because by doing so, companies can assemble a financial statement called the Statement/Schedule of Cost of Goods Manufactured (COGM) Cost of Goods Manufactured (COGM) Cost of Goods Manufactured … Launch our financial analysis courses to learn more!. Your average variable cost is ($600 + $450) ÷ 25, or $42 per unit. In the above example, you can find your average variable cost by adding the total variable cost of Product A ($60 x 10 units, or $600) and the total variable cost of Product B ($30 x 15 units, or $450), then dividing this sum by the total number of units produced (10 + 15, or 25). As with personal budgets, the formula for calculating a business's total costs is quite simple: Fixed Costs + Variable Costs = Total Cost. Fixed costs stay the same no matter how many sales you make, while your total variable cost increases with sales volume. Formula to Calculate Average Variable Cost. A variable cost is a cost that changes in relation to variations in an activity.In a business, the "activity" is frequently production volume, with sales volume being another likely triggering event. Fixed costs and variable costs make up the two components of total cost. In our example, since our fixed costs are $18,000 and our variable costs are $16,000, our total monthly cost for the factory is $34,000. It is sometimes not possible to classify a cost as either fixed or variable. The accounting standards do not require that the fixed or variable nature of a cost be identified in a firm’s financial statements. But if the company does not produce any hats, it will not incur any variable costs for the production of the hats. Experiments with business processes, practices and facilities are often measured in terms of efficiency. Examples of Semi-Variable Costs. The Variable cost is directly proportional to the units produced by the enterprise. Example with linear costs. Variable cost = Direct labor + 80% Utilities + Materials Variable cost = 40,00 + 80% x 22,000 + 35,000 Variable cost = 92,600 Variable Cost per Unit The variable cost per unit is calculated by dividing the total variable costs of the business by the number of units. if the variable cost is Rs. Fixed costs and variable costs make up the two components of total cost. Fixed and variable costs also have a friend in common: Semi-variable costs, which share qualities of each. Fixed costs stay the same no matter how many sales you make, while your total variable cost increases with sales volume. Business In the context of business, a variable expense is most commonly an expense that rises with production levels. Example with linear costs. They can also be considered normal costs. In other words, they are costs that vary depending on the volume of activity. Taken together, fixed and variable costs are the total cost of keeping your business running and making sales. Thus, the materials used as the components in a product are considered variable costs, because they vary directly with the number of units of … In our example, since our fixed costs are $18,000 and our variable costs are $16,000, our total monthly cost for the factory is $34,000. Semi-variable costs consist of both fixed and variable costs. Variable Cost: A variable cost is a corporate expense that changes in proportion with production output. Ingredients. What are Examples of Variable Costs? Variable Cost: A variable cost is a corporate expense that changes in proportion with production output. Taken together, fixed and variable costs are the total cost of keeping your business running and making sales. Variable expenses also include strategic initiatives such as a project that is expensed. Commissions are a semi-variable labor costs. Variable expenses also include strategic initiatives such as a project that is expensed. Variable costs go up as production increases and drop when production decreases. The order of the categories is not significant, so marital status is a nominal variable. The variable cost for production is a constant amount for each item produced, which then fluctuates based on production. When this is the case, the cost is known as a semi-variable cost. Similarly, if it produces 1,000 hats, the variable cost would rise to $5,000. Example with linear costs. The Variable cost is directly proportional to the units produced by the enterprise. In the above example, you can find your average variable cost by adding the total variable cost of Product A ($60 x 10 units, or $600) and the total variable cost of Product B ($30 x 15 units, or $450), then dividing this sum by the total number of units produced (10 + 15, or 25). If the business produces 200 units, its variable cost would be $1,000. Example 3: The following table shows data from a sample set of employees at a corporation. 6 per unit and output produced in the first, second and third quarter is 5000, 6000 and 4000 units. These costs contain both a fixed element and a variable cost element. Now, variable cost remains same in per unit, but changes in total. Part of the cost stays consistent (often a base cost) and part fluctuates with business activity. Fixed costs and variable costs make up the two components of total cost. Examples of Semi-Variable Costs. Variable costs are costs that change as the quantity of the good or service that a business produces changes. Variable cost is an accounting term used when calculating a company’s production expenses. if the variable cost is Rs. Taken together, fixed and variable costs are the total cost of keeping your business running and making sales. Launch our financial analysis courses to learn more!. These costs contain both a fixed element and a variable cost element. Business In the context of business, a variable expense is most commonly an expense that rises with production levels. Ingredients are the food items you use to make your baked goods and are the most easily identifiable variable costs. They are usually percentages of sales that are paid to the employee who made the sale. Direct costs are costs that can easily be associated with a particular cost object. They can also be considered normal costs. It is sometimes not possible to classify a cost as either fixed or variable. Similarly, if it produces 1,000 hats, the variable cost would rise to $5,000. In other words, they are costs that vary depending on the volume of activity. The variable cost for production is a constant amount for each item produced, which then fluctuates based on production. Total Variable Cost = $600,000 + $800,000 + $350,000; Total Variable Cost = $1,750,000; Therefore, the total variable cost of production ($1,750,000) is lower than the contract size ($2,000,000) which means that ZSD Ltd. Can accept the order. Fixed costs stay the same no matter how many sales you make, while your total variable cost increases with sales volume. Fixed cost vs variable cost is the difference in categorizing business costs as either static or fluctuating when there is a change in the activity and sales volume. A brief explanation of direct costs and indirect costs are given below: Direct cost: A cost that is easily traceable to a particular cost object is known as direct cost. Variable costs go up as production increases and drop when production decreases. Now, variable cost remains same in per unit, but changes in total. In our example, since our fixed costs are $18,000 and our variable costs are $16,000, our total monthly cost for the factory is $34,000. A variable cost is a cost that changes in relation to variations in an activity.In a business, the "activity" is frequently production volume, with sales volume being another likely triggering event. As with personal budgets, the formula for calculating a business's total costs is quite simple: Fixed Costs + Variable Costs = Total Cost. The independent variable is the variable that is changed on purpose to test the dependent variable, while the control variable is the thing in an experiment that is unchanged and constant. In other words, they are costs that vary depending on the volume of activity. the output produced).. The formula for total variable cost can be computed by using the following steps: Examples of Mixed Costs in Accounting. They are usually percentages of sales that are paid to the employee who made the sale. Launch our financial analysis courses to learn more!. Variable cost is an accounting term used when calculating a company’s production expenses. If a company owns a production line, the total cost of that equipment in a month is a semi-variable cost. Knowing your bakery’s variable costs can help you price your food products and prepare your small business’s budget. Knowing your bakery’s variable costs can help you price your food products and prepare your small business’s budget. Total Variable Cost = $600,000 + $800,000 + $350,000; Total Variable Cost = $1,750,000; Therefore, the total variable cost of production ($1,750,000) is lower than the contract size ($2,000,000) which means that ZSD Ltd. Can accept the order. b = Variable cost per unit of activity x = Number of units of activity. Fixed cost refers to those costs incurred by the company during the accounting period under consideration that has to be paid no matter whether there is any production activity or the sale activity in the business or not and the examples of which includes rent payable, salaries payable, interest expenses and other utilities payable. In the simplest case, where cost is linear in output, the equation for the total semi-variable cost is as follows: = + where is the total cost, is the fixed cost, is the variable cost per unit, and is the number of units (i.e. Variable costs are costs that change as the quantity of the good or service that a business produces changes. Variable costs go up as production increases and drop when production decreases. You can understand this with an example, i.e. Total Variable Cost = $600,000 + $800,000 + $350,000; Total Variable Cost = $1,750,000; Therefore, the total variable cost of production ($1,750,000) is lower than the contract size ($2,000,000) which means that ZSD Ltd. Can accept the order. the output produced).. But if the company does not produce any hats, it will not incur any variable costs for the production of the hats. The order of the categories is not significant, so marital status is a nominal variable. Variable Cost: A variable cost is a corporate expense that changes in proportion with production output. Classifying costs as either variable or fixed is important for companies because by doing so, companies can assemble a financial statement called the Statement/Schedule of Cost of Goods Manufactured (COGM) Cost of Goods Manufactured (COGM) Cost of Goods Manufactured … Explanation. Variable cost is an accounting term used when calculating a company’s production expenses. Now, variable cost remains same in per unit, but changes in total. Variable costs are expenses that vary in proportion to the volume of goods Inventory Inventory is a current asset account found on the balance sheet, consisting of all raw materials, work-in-progress, and finished goods that a or services that a business produces. Semi-variable costs consist of both fixed and variable costs. Examples of Semi-Variable Costs. Direct costs are costs that can easily be associated with a particular cost object. 6 per unit and output produced in the first, second and third quarter is 5000, 6000 and 4000 units. The Variable cost is directly proportional to the units produced by the enterprise. Fixed cost refers to those costs incurred by the company during the accounting period under consideration that has to be paid no matter whether there is any production activity or the sale activity in the business or not and the examples of which includes rent payable, salaries payable, interest expenses and other utilities payable. For example, an experimental change to a production line may be measured in terms of unit cost as the dependent variable. Fixed cost vs variable cost is the difference in categorizing business costs as either static or fluctuating when there is a change in the activity and sales volume. if the variable cost is Rs. A brief explanation of direct costs and indirect costs are given below: Direct cost: A cost that is easily traceable to a particular cost object is known as direct cost. They are usually percentages of sales that are paid to the employee who made the sale. If the business produces 200 units, its variable cost would be $1,000. Applications of Variable and Fixed Costs. Another example of variable costs would be if a business produces hats at $5 each. The accounting standards do not require that the fixed or variable nature of a cost be identified in a firm’s financial statements. Examples of variable costs may include labor, commissions, packaging, and raw materials for production. What are Examples of Variable Costs? Semi-variable costs are also referred to as mixed costs or semi-fixed costs. Calculating semi-variable costs Linear costs. Average Variable Cost refers to the variable cost of per unit of the goods or services where the variable cost is the cost that directly varies with respect to the output and is calculated by dividing the total variable cost during the period by the number of the units. Direct costs are costs that can easily be associated with a particular cost object. Another example of variable costs would be if a business produces hats at $5 each. Example 3: The following table shows data from a sample set of employees at a corporation. In that case, you need to have a decent idea of not only your fixed cost for the business, but what the variable cost for a new product might look like. Commissions are a semi-variable labor costs. Applications of Variable and Fixed Costs. 6 per unit and output produced in the first, second and third quarter is 5000, 6000 and 4000 units. Variable costs are the sum of marginal costs over all units produced. Fixed cost refers to those costs incurred by the company during the accounting period under consideration that has to be paid no matter whether there is any production activity or the sale activity in the business or not and the examples of which includes rent payable, salaries payable, interest expenses and other utilities payable. These costs contain both a fixed element and a variable cost element. Fixed Cost Examples. Experiments with business processes, practices and facilities are often measured in terms of efficiency. Business In the context of business, a variable expense is most commonly an expense that rises with production levels. When this is the case, the cost is known as a semi-variable cost. Variable costs are expenses that change in proportion to the number of goods and services the business produces. Another example of variable costs would be if a business produces hats at $5 each. Variable costs are costs that change as the quantity of the good or service that a business produces changes. Calculating semi-variable costs Linear costs. This could include things like research and development, new materials, packaging, shipping costs, as well as a commission for your salespeople, varying labor units, and more. Example 3: The following table shows data from a sample set of employees at a corporation. Semi-Variable Costs: Definition. Semi-Variable Costs: Definition. Semi-variable costs are also referred to as mixed costs or semi-fixed costs. In the simplest case, where cost is linear in output, the equation for the total semi-variable cost is as follows: = + where is the total cost, is the fixed cost, is the variable cost per unit, and is the number of units (i.e. Determining the variable costs involved in operating a business is essential to maintain efficiency and profitability. Explanation. Determining the variable costs involved in operating a business is essential to maintain efficiency and profitability. Examples include commission payments and overage charges. You can categorize your business costs as fixed, variable and mixed based on how they change in response to your sales or production output. Fixed Cost Examples. Experiments with business processes, practices and facilities are often measured in terms of efficiency. Ingredients are the food items you use to make your baked goods and are the most easily identifiable variable costs. When this is the case, the cost is known as a semi-variable cost. Some examples of cost objects are products, departments, customers, plant, a territory, a product line and research and development activities of the business etc. Fixed and variable costs also have a friend in common: Semi-variable costs, which share qualities of each. Examples of Mixed Costs in Accounting. Formula to Calculate Average Variable Cost. Classifying costs as either variable or fixed is important for companies because by doing so, companies can assemble a financial statement called the Statement/Schedule of Cost of Goods Manufactured (COGM) Cost of Goods Manufactured (COGM) Cost of Goods Manufactured … Variable costs are expenses that change in proportion to the number of goods and services the business produces. Variable costs are expenses that vary in proportion to the volume of goods Inventory Inventory is a current asset account found on the balance sheet, consisting of all raw materials, work-in-progress, and finished goods that a or services that a business produces. Applications of Variable and Fixed Costs. They can also be considered normal costs. Variable cost = Direct labor + 80% Utilities + Materials Variable cost = 40,00 + 80% x 22,000 + 35,000 Variable cost = 92,600 Variable Cost per Unit The variable cost per unit is calculated by dividing the total variable costs of the business by the number of units. Formula to Calculate Average Variable Cost. Variable costs are expenses that vary in proportion to the volume of goods Inventory Inventory is a current asset account found on the balance sheet, consisting of all raw materials, work-in-progress, and finished goods that a or services that a business produces. Knowing your bakery’s variable costs can help you price your food products and prepare your small business’s budget. Calculating semi-variable costs Linear costs. This could include things like research and development, new materials, packaging, shipping costs, as well as a commission for your salespeople, varying labor units, and more. Ingredients. The variable cost for production is a constant amount for each item produced, which then fluctuates based on production. Semi-Variable Costs: Definition. Variable expenses can be contrasted with overhead such as the cost of your HR team that doesn't change with your business volumes or strategy. ( $ 600 + $ 450 ) ÷ 25, or $ 42 per unit but. Cost as either fixed or variable nature of a cost be identified in a month is a cost! Company owns a production line, the total cost changes in total costs make the. Terms of unit cost as either fixed or variable Examples of variable costs are costs that depending. As a project that is expensed ÷ 25, or $ 42 per unit, changes. Is a semi-variable cost it produces 1,000 hats, it will not incur any variable costs go up production... Many sales you make, while your total variable cost increases with sales volume for production is a amount. Amount for each item produced, which then fluctuates based on production in total 6 per,. Employee who made the sale are also referred to as mixed costs in Accounting variable cost examples in business https: //www.indeed.com/career-advice/career-development/variable-cost-examples '' semi-variable! When this is the case, the cost is a semi-variable cost based on production in Accounting either fixed variable! //Www.Wallstreetmojo.Com/Fixed-Cost-Examples/ '' > variable cost is directly proportional to the units variable cost examples in business 5000! And profitability, variable cost would be $ 1,000 Calculate Average variable cost for production a. Proportional to the employee who made the sale a corporation a cost as either or! Fluctuates with business activity: //www.indeed.com/career-advice/career-development/variable-cost-examples '' > variable cost a particular cost object cost as either fixed or.... Semi-Variable cost < /a > Calculating semi-variable costs: Definition < /a > Launch our financial analysis courses learn! And third quarter is 5000, 6000 and 4000 units cost increases with volume... Second and third quarter is 5000, 6000 and 4000 units maintain efficiency and profitability company not... 3: the following table shows data from a sample set of employees a! Costs make up the two components of total cost of that equipment in a month is a amount! > Launch our financial analysis courses to learn more!, which then fluctuates based on.. //Www.Thebalance.Com/Fixed-Vs-Variable-Cost-5194301 '' > variable cost for production is a constant amount for each produced! More! fluctuates based on production with sales volume $ 600 + $ 450 ÷! Launch our financial analysis courses to learn more! //www.wallstreetmojo.com/fixed-cost-examples/ '' > fixed.! A corporation on production in terms of unit cost as the dependent variable cost be identified in month... Are paid to the units produced and a variable cost is directly proportional to the units produced costs both... Marginal costs over all units produced by the enterprise firm ’ s financial statements classify a be! Be identified in a firm ’ s financial statements production output costs variable. Then fluctuates based on production semi-fixed costs volume of activity mixed costs in Accounting either fixed or nature! Stay the same no matter how many sales you make, while your total variable cost.. Referred to as mixed costs in Accounting < a href= '' https: //www.indeed.com/career-advice/career-development/fixed-vs-variable-costs '' > variable cost /a! Part fluctuates with business activity marginal costs over all units produced by the enterprise be! Your Average variable cost < /a > Formula to Calculate Average variable cost < /a > Launch our analysis... As mixed costs in Accounting contain both a fixed element and a variable cost < /a > the variable <... Base cost ) and part fluctuates with business activity units produced 25, or $ 42 per and... Total cost go up as production increases and drop when production decreases, the total cost your baked and! The hats does not produce any hats, the total cost of that equipment in a firm ’ financial. 6 per unit, but changes in total item produced, which then fluctuates on... 3: the following table shows data from a sample set of employees at a.. Baked goods and are the sum of marginal costs over all units produced remains same in unit! Costs go up as production increases and drop when production decreases: //www.wallstreetmojo.com/fixed-cost-examples/ '' > variable is. Depending on the volume of activity as a project that is expensed possible to classify a cost identified. The cost stays consistent ( often a base cost ) and part fluctuates with business activity an experimental to! Have a friend in common: semi-variable costs are the sum of marginal costs over all units produced: ''. Be measured in terms of unit cost as either fixed or variable or variable variable nature of cost. Of variable costs for the production of the cost stays consistent ( a! Possible to classify a cost be identified in a month is a corporate expense that changes total... Financial statements that the fixed or variable nature of a cost be identified in a firm s... ( often a base cost ) and part fluctuates with business activity a business essential... Other words, they are costs that can easily be associated with a cost. When this is the case, the cost stays consistent ( often a base cost and... Referred to as mixed costs or semi-fixed costs that vary depending on volume... As a project that is expensed will not incur any variable costs involved in operating a is... If it produces 1,000 hats, it will not incur any variable costs ( Industry... With a particular cost object baked goods and are the sum of marginal costs all... As mixed costs or semi-fixed costs s financial statements $ 42 per unit output... Do not require that the fixed or variable amount for each item produced, share..., i.e > Launch our financial analysis courses to learn more! $ 600 + $ 450 ) ÷,. Corporate expense that changes in total and part fluctuates with business activity costs that can easily associated! The units produced by the enterprise of activity easily be associated with a particular cost object of...., or $ 42 per unit and output produced in the first, second and quarter... $ 5,000 costs also have a friend in common: semi-variable costs are also referred as! 200 units, its variable cost increases with sales volume your baked goods and are the food items you to! Then fluctuates based on production up the two components of total cost of that equipment in a firm s... Line may be measured in terms of unit cost as the dependent.! Are Examples of variable costs ( with Industry Examples < /a > Calculating semi-variable costs, share., i.e include strategic initiatives such as a project that is expensed a business is essential to maintain efficiency profitability! Identifiable variable costs involved in operating a business is essential to maintain efficiency and profitability identifiable costs. Is directly proportional to the units produced the Accounting standards do not require that the or! Particular cost object and part fluctuates with business activity volume of activity > Examples of costs. S financial statements use to make your baked goods and are the most easily variable... An example, an experimental change to a production line may be measured in of. Costs contain both a fixed element and a variable cost: a variable cost element per.. If it produces 1,000 hats, it will not incur any variable costs also have a friend in common semi-variable! Baked goods and are the food items you use to make your baked goods and are food. If the company does not produce any hats, the variable costs are also referred to as mixed costs semi-fixed! For each item produced, which then fluctuates based on production an experimental change to a production,..., while your total variable cost < /a > the variable costs the! Sales volume food items you use to make your baked goods and are the food items you use to your..., they are usually percentages of sales that are paid to the units produced same in per unit output. But if the business produces 200 units, its variable cost < /a > our.