cost concept-types of costs

Concept of costs :-costs are expenses incurred in the process of producing Or acquiring goods and services. Another words quotes is a payment made or sacrifice in curd in order that a benefit maybe secured. 

Types of costs :- there are many types of cost

1https://bscience1623.blogspot.com/2023/04/cost-concept-types-of-costs.html.Variable cost :- variable cost are those costs that very with the level of production or sales. If the production increases then the prime cost also increase and they get reviews with the fall in production. 

a) Total variable cost

b) Average variable cost

2.Semi variable cost :- Semi variable costs is a cost  which is fall between fixed and variable cost semi variable cost or neither perfectly variable nor absolutely fixed in relation to changes in output. 

3.Fixed cost :- fixed cost is the type of cost that do not very with the level of production or sales. Fixed cost must be in curd in every situation whether there is or there is not any production. It is always be fixed the increasing and the decreasing of production does not affect the fixed cost. 

Ex. Salary of the employee in the company is one of the example of cost. 

a) Total fixed cost

b) Average cost

4.Total cost :- total cost is a type of course of production it means that the total money expenses in curd for buying the raw material required for producing  goods and service. In the total cost all those payments included made in cash to various factors of production and all the charges which would have otherwise been paid. 

In simple way the total cost of a business firm is the sum of its variable cost and fixed cost of a particular level of output. 

TC =VC + FC

Where 

            TC =Total cost 

             VC= variable cost

             FC = Fixed cost

5.Marginal cost :- marginal cost are the additional cost incurred when producing one more unit of product or Service. Marginal cost are important in determining the optimal level of production. Marginal cost is always independent of the size of fixed cost, the shape of the curve in marginal cost will be you which shows that marginal cost declines first and afterward increases. 

6.Average cost:- it is the cost per unit of output to obtain average cost total cost has to divide by the total quantity produced. 

          AC=TC/Q

WHERE 

         AC - Average cost

         TC - Total cost

         Q - Unit of output produced