VARIABLE COSTS

Posted by Dario Favaretto
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The variable costs are those that vary more or less proportionally compared to changes in activities volume (purchasing, production, sales). Activities volumes stand for the outputs that, depending on the company, measure the occupational level or the firm’s structure. They represent the resources whose consumption can be revised in order to adapt it to their demand. In the Anglo-Saxon jargon, a variable cost system in called “direct costing”.

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