4 - Costs Flashcards
1
Q
What is meant by “costs”?
A
Expenses a business incurs
2
Q
What are 2 examples of costs for a business?
A
Wages
Electricity bills
3
Q
What is the formula for working out total costs?
A
Fixed Costs + Variable Costs
4
Q
What is meant by “fixed costs”?
A
Costs that don’t vary with output
5
Q
What is an example of a business where registering would be a fixed cost?
A
Snapchat
6
Q
What are 3 examples of fixed costs?
A
Rent
Insurance
Salaries
7
Q
When can fixed costs possibly increase?
A
When a business grows
8
Q
What is meant by “variable costs”?
A
Costs that change with output
9
Q
What are 3 examples of variable costs?
A
Labour
Raw materials
Transport costs
