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I am confused between definitions of fixed cost and stepped fix cost. I have idea of both cost behaviors but there definition are same.
“Fixed cost is cost which within certain level of activity remains constant.”
“Step Fixed cost are fixed cost within certain level of activity and once the upper limit is reached so a higher level of fixed costs become relevant.”My question is that if the writer has said that step fixed is fixed till a certain activity and then changes so why he has repeated same thing for fixed cost.
You need to ask the writer, not me!!
However there is nothing wrong with both statements.
Within a certain level of activity the cost remains constant.That is the case whether or not it is a stepped fixed cost.
Please do not keep asking me to explain what someone else has written in some other book.
My lectures cover everything needed to be able to pass the exam well, so ask about anything that is not clear in my lectures.
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