ECONOMICS

Detailed explanation-1: -Mixed costs are costs that contain a portion of both fixed and variable costs. Common examples include utilities and even your cell phone!

Detailed explanation-2: -A mixed cost is a cost that contains both fixed costs and variable costs. This means that some costs do not change and others might. A mixed cost is also called a semi-variable cost. To calculate a mixed cost, one must determine the fixed and variable costs, and then add them together to get the total cost.

Detailed explanation-3: -However, the cost of electricity is a variable cost since electricity usage increases with the number of products that are produced or manufactured. In short, if the total cost associated with the cost object changes when the production amount changes, it’s likely a variable cost.

Detailed explanation-4: -Examples of variable costs include raw materials, labor, utilities, commission, or distribution costs.

Detailed explanation-5: -What is a Mixed Cost? A mixed cost is a cost that contains both a fixed cost component and a variable cost component. It is important to understand the mix of these elements of a cost, so that one can predict how costs will change with different levels of activity.