Question

What is variable cost or direct cost

Answer 1

Direct costs are expenses that can be directly tied to the production of a product and can include direct labor and direct material costs.Direct costs can be fixed costs such as the rent for a production plant.

Variable costs vary with the level of production output and can include raw materials and supplies for the machinery.Variable costs can also be indirect costs such as electricity for the production plant since it can't be tied to one specific product.

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