- This topic has 1 reply, 2 voices, and was last updated 1 year ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
PQ Awards Nominations
Please help us to win one of the PQ Magazine awards and send in the voting form >>
You can nominate us in any or all of the following categories: Online College of the Year, Study Resource of the Year, Private Sector Lecturer of the Year, and Accountancy Personality of the Year.
Specially for OpenTuition students: 20% off BPP Books for ACCA & CIMA exams – Get your BPP Discount Code >>
Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Fixed cost question
What is the difference between General fixed cost and Specific fixed cost?
Is it correct that direct cost is a variable cost and indirect cost is fixed cost in nature?
And is it also correct that both fixed costs are relevant costs?
General fixed costs are costs that are incurred whatever is produced. Specific fixed costs are only incurred if the specific product to which they relate is produced.
Direct costs are always variable. Indirect costs can be variable of fixed – this is all explained in my free lectures.
Fixed costs may or may not be relevant – it depends on what decision is being made and what the information is in the question. Most often they are not relevant because the total is not affected by the level of production.