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Cost Concepts: Balance of Fixed and Variable Costs

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Choose an organization that has a high fixed cost and low variable cost balance to run its operations. Discuss the balance of fixed and variable costs for the organization. How can the organization use technology to change this balance for an advantage?

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This solution identifies software companies as having high fixed costs and low variable costs. This solution is 191 words.

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An example of such organization will be software companies like Microsoft, Adobe or Mcafee that have high fixed costs but lower variable costs as most of the software companies have to spend on fixed costs like salary of employees for R&D, customer support and development related functions. Once fixed costs are ...

Solution provided by:
Sheetal Jain, PGDM
Education
  • BComm, University of Delhi
  • Post Graduate Diploma in Management (Equivalent to MBA), All India Management Association
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