Cost Of Sales

Question 1

Fixed cost

Answer 1

•these are incurred by the business regardless of how well it is doing e.g. business rates

Question 2

Variable costs + formula

Answer 2

• these increase when the business increase its activity or output e.g. raw materials
• total variable cost= variable cost per unit × quantity

Question 3

Sales

Answer 3

• selling price per unit - amount paid by each customer for each item bought
• sales in units - quantity of sales
• sales in value - selling price × the number of units sold