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Variable Costs
Expenses that vary directly with the level of production or sales, such as materials and labor.
Break-even Sales
The amount of revenue required to cover total fixed and variable costs, resulting in zero profit or loss.
Fixed Costs
Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and insurance premiums, remaining constant regardless of variations in business activity.
Variable Costs
Expenses that change in proportion to the activity of a business, such as materials or labor directly tied to production volume.
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