Companies focus on their fixed costs to maximize profits at the end of the fiscal year. If a company's fixed costs are too high, the company might not create a profit for that fiscal period.

So many of a business’ costs fluctuate based on operations. For example, the more products you make, the more you’ll spend on materials to make them. However, there are several important costs that ...

In traditional cost accounting for manufacturing, categorizing costs as fixed or variable has been part of accepted practice for a long time. In recent years, the practice has diminished because this ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Charlene Rhinehart is a CPA , CFE, chair of ...

Sunk costs are unrecoverable and should not influence future spending decisions. Not all fixed costs are sunk; some can be recouped, like equipment resale. Sunk costs can result from both everyday ...