Fixed Costs Measure

A Fixed Costs Measure is a cost measure that is a fixed function (does not change with an increase or decrease in the amount of goods or services produced).

AKA: Indirect Cost, Overhead Cost.
Context:
- It can range from being a Shared Fixed Cost to being an Unshared Fixed Cost.
- …
Counter-Example(s):
- Variable Cost.
See: Expenses, Management Accounting, Fixed Costs, Total Cost, Capital Investment, Network Externalities.

References

(Wikipedia, 2014) ⇒ http://en.wikipedia.org/wiki/fixed_cost Retrieved:2014-4-10.
- In economics, fixed costs, indirect costs or overheads are business expenses that are not dependent on the level of goods or services produced by the business. ^[1] They tend to be time-related, such as salaries or rents being paid per month, and are often referred to as overhead costs. This is in contrast to variable costs, which are volume-related (and are paid per quantity produced). In management accounting, fixed costs are defined as expenses that do not change as a function of the activity of a business, within the relevant period. For example, a retailer must pay rent and utility bills irrespective of sales. In marketing, it is necessary to know how costs divide between variable and fixed. This distinction is crucial in forecasting the earnings generated by various changes in unit sales and thus the financial impact of proposed marketing campaigns. In a survey of nearly 200 senior marketing managers, 60 percent responded that they found the "variable and fixed costs" metric very useful.^[2]

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↑ Farris, Paul W.; Neil T. Bendle; Phillip E. Pfeifer; David J. Reibstein (2010). Marketing Metrics: The Definitive Guide to Measuring Marketing Performance. Upper Saddle River, New Jersey: Pearson Education, Inc. ISBN 0-13-705829-2. The content used from this source has been licensed under CC-By-SA and GFDL and may be used verbatim. The Marketing Accountability Standards Board (MASB) endorses the definitions, purposes, and constructs of classes of measures that appear in Marketing Metrics as part of its ongoing Common Language: Marketing Activities and Metrics Project.

http://www.investopedia.com/terms/f/fixedcost.asp
- QUOTE: A cost that does not change with an increase or decrease in the amount of goods or services produced. Fixed costs are expenses that have to be paid by a company, independent of any business activity. It is one of the two components of the total cost of a good or service, along with variable cost.