Fixed, Mixed, and Variable Cost

Fixed, Mixed, Variable Cost
Name
Institution Affiliation
Course
Professor
Date
Fixed, Mixed, Variable Cost
For this assignment, I inspire to work in an RV dealership company; The Lazydays RV Supercenter. The cost of any given company can be classified as fixed, mixed, or variable depending on the level of activities. Fixed expenses are costs that do not change at any level of activity of any given firm. The costs remain constant despite the production or sales incurred in any particular level. For instance, rent and salaries are fixed expenses that do not change with the level of production and sales. This includes the total expenses to lease an office or area of operation. Lazydays RV occupies 126 acres of land and the lease agreement does not change with production or sales (Wendland, 2023).
Notably, variable expenses change in direct proportion to the level of production. This means that the expenses increase or decrease with the increase or decrease in the volume of output. For instance, raw material is directly integrated into all levels of production (Gold et al., 2022). This means that an increase in the cost of raw materials increases the cost of production. For Lazydays RV Supercenter, an increase in the cost of raw materials t...