What are examples of Variable Cost?

Answer 1

AnswerVariable costs change in relation to (and generally in proportion to) sales.

Examples include:

Chlorine costs for a pool-service company. (More pools serviced = more revenues = more chlorine bought).

The cost of nails for a building contractor. (More houses sold = more nails bought).

The cost of temporary labor for a temporary staffing company. (More temps placed = more temps hired and paid.)

The cost of paper for a printing company. (More jobs printed = more paper used)

The cost of beef for a restaurant. (You get the idea).

**Costs will increase per production**

if there are no production, then there are no costs

therefore any 'materials' is an example

Answer 2

Variable costs are costs that varies or are not fixed. Those are expenses that change in proportion to the activity of a business. Examples are: raw materials (when the activity is decreased, less raw materials are used), transportation costs.

However, its distinction as variable or fixed may vary on different organizations or situations. A salary of a regular employee is fixed, while salary of an hourly employee is variable.

Some expenses also have fixed and variable elements. These are called semi-variable costs. Electricity may be fixed on some organizations, but may vary depending on their activity.