What Are Variable Costs?

variable cost  A variable cost is a recurring cost that changes in value according to the rise and fall of a company's revenue and output level Variable costs The price of a commodity such as natural gas or oil is variable because it changes almost daily The longer the time horizon, the more time a firm has to adjust

rate to cover the cost of new borrowing and the cost of interest paid on deposits A variable rate mortgage would be most beneficial to the operative An employee's salary would be considered a fixed cost, while sales commissions are variable While fixed costs do change over a long-term period, this change

A variable cost is any corporate expense that changes along with changes in production volume As production increases, these costs rise and as Divide total variable costs by number of units The resulting number will be your variable cost per unit Variable cost