Variable COst, Other Topics

[krishna besta]

This is Krishna.

I am in ambiguity to conclude the below mentioned point. 

Iam working in Restaurant Organization. We have to segargate for Cost Classification for Deefrezer Electricity Expenses. Deepreezer is Essential in Restaurant for freezing the goods in Cool Temparature.

Whether the Defreezer Electricity Charges as Considered as a Fixed Cost or Variable Cost.

Posts / Replies

[Sarath chandran]

The question is not clear how you are incurring the electricity  charges. Is it on the basis of the Units consumed or are you paying as fixed charges? Fixed expenses are those expenses which will not change on the basis of production quantities and will change only on the basis of time. Say for example irrespective of the Unit consumed you have to pay a fixed electricity charges for a month.

 

Considering that you may classiffy defreezer electricity charges as fixed or variable.