UK Accounting Glossary
An item of expenditure that, in total, varies directly with the level of activity achieved.
For example: The cost of direct materials will tend to double if output doubles, a characteristic being that it is incurred at a constant per unit produced.
In practice, there are very few examples of true variable costs or true fixed costs; with most costs being semi-variable costs.
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This glossary post was last updated: 5th May 2019.