| 31. | The model works best in industries that have low variable cost of production or inventory.
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| 32. | The level of variable cost is influenced by many factors, such as fixed cost, discount rate.
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| 33. | For example, variable manufacturing overhead costs are variable costs that are indirect costs, not direct costs.
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| 34. | However, not all variable costs are direct costs.
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| 35. | The cost of material is a variable cost.
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| 36. | Variable costs are fixed on a percentage basis.
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| 37. | Variable costs are sometimes called unit-level costs as they vary with the number of units produced.
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| 38. | The economy will have to incur more variable costs, such as overtime, to produce the unit.
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| 39. | Variable costs as a percentage of sales are equal to 100 % minus the contribution margin ratio.
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| 40. | Every year, PNC offsets the swans'variable cost by calculating a core index that excludes such cost anomalies.
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