What Is a Variable Cost?

variable cost  The formula for variable costs is: total quantity of output X variable cost per unit of output = variable cost A business would need to find this data for a The most common variable costs include raw materials, direct labor, and shipping costs These costs are directly tied to the production volume and can change

A variable cost remains the same per unit but changes in total Variable cost examples include sales commissions, hourly workers, and units-of-production method Understand variable cost in business Learn the definition of variable cost, the variable cost

Variable costs are costs which change with output As output increases the firm needs to use more raw materials and employ more workers  Variable costs are the costs a company incurs proportionately to production quantity or revenue, including any costs that fluctuate