Understanding Semi-Variable Costs

What are semi-variable costs?

• Costs that have both fixed and variable components

• Costs that are only variable

• Costs that are only fixed

• Costs that do not change with output

Which of the following is an example of a fixed cost?

• Materials

• Sales commission

• Direct labor

• Rent

What is the first step in calculating the variable cost per unit?

• Calculating the total cost

• Subtracting fixed costs from total costs

• Identifying the highest and lowest costs and units

• Finding the average cost

How do you calculate the variable cost per unit?

• Multiply fixed costs by variable costs

• Divide the difference in costs by the difference in units

• Subtract fixed costs from total costs

• Divide total cost by total units

What is the purpose of calculating the total variable cost for a given output?

• To identify the variable cost per unit

• To find the total cost

• To determine the fixed cost per unit

• To calculate the profit margin

How is the fixed cost determined using the high-low method?

• By adding variable costs to total costs

• By multiplying variable costs by units

• By subtracting total variable costs from total costs

• By dividing total costs by total units

What is the final step in calculating the total cost for a given output?

• Adding fixed and total variable costs

• Multiplying fixed costs by variable costs

• Subtracting fixed costs from total costs

• Dividing total costs by units

If the variable cost per unit is £7, what is the total variable cost for 12,100 units?

• £78,400

• £84,700

• £39,000

• £123,700

What is the total cost if the output is 12,100 units?

• £84,700

• £123,700

• £39,000

• £78,400

Which method is used to separate fixed and variable costs in this video?

• Break-even analysis

• Cost-volume-profit analysis

• High-low method

• Regression analysis