LEARNING ACTIVITY 2.4 BUSSINESS MANAGEMENT

1. TYPES OF COST
TEACHER: MSC. VERONICA ALMEIDA
NAME: Veronica Moreno

2. Costs are the necessary
expenditures that must be made
in order to run a business. Every
factor of production has an
associated cost.

3.  A business incur costs, they are used in forecasting and planning.
 The costs of a business can be identified as fixed or variable
costs, or direct and indirect costs.

4. Types of the
cost
Fixed
IndirectDirect
Variable

5. There are some items a business
must pay for whether or not it
actually produces anything.
They don’t change no matter how
many products the business actually
makes or sells.
It will change in long term.
Costs that vary with the level of
output, in other words, costs can
change according to the
products.
More goods or services produced,
the higher the variable costs that
have to be paied.
Variable
Costs
Fixed costs

6. Types of costs
Indirect
They are costs of a business that
are not directly incurred in the
production process.
(salaries of all other employees,
including supervisor and managers)
. This is the point at which the
amount of good or services
produced and sold cover the cost of
production.
direct
Is the amount by which total costs
increase the production of one
additional unit.
MaMrginal costs
They are those cost that are direct
incurred in the production process.
(items – raw materials)
Marginal Costs
They are those cost that are direct
incurred in the production process.
(items – raw materials)