Learning outcomes
Types of business costs
Graphs of business costs
Introduction to break-even
Finding the break-even point - activity
Break-even point by graph
Conclusion
Glossary

Costing

Graph of business costs

When a business has calculated its fixed and variable costs, it can then work out the total costs using the formula:

Each of the three types of costs can be displayed using a graph, similar to the one below. You now know that fixed costs remain constant even when the production levels change, while variable costs increase as production levels increase, and that when fixed and variable costs are added together it equals total costs.

Drag the three labels to the correct places on the graph below.






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