briefly explain the difference between fixed cost and indirect cost, and variable cost and direct cost?

Anonymous2011-05-08T01:10:11Z

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A fixed cost is something that will be incurred whether the company sells 1 unit or 1,000 units (mortgages and loans). An indirect cost is something that the business incurs, but does not add observable value to the product (janitorial services). Variable cost changes with the number of units you produce (raw materials cost). Direct costs are usually variable costs but don't have to be and they add observable value to the product (paint for a car manufacturer).

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