fixed cost
Unchanging business expense
A fixed cost is an expense that remains constant regardless of production or sales volume.
Rent, insurance premiums, and salaried wages are fixed costs—they don't change whether a business produces one unit or a thousand.
Contrasts with variable costs, which fluctuate with output.
The restaurant's fixed costs were killing them even when they had no customers.
Payment for temporary use
- salariesFixed regular payments for work
- insuranceContractual risk coverage
- utilitiesEssential infrastructure services
- depreciationAsset value reduction over time
lease · property taxes · maintenance · amortization · security · office supplies · cleaning services · administrative
Asset value reduction over time
- amortizationGradual debt reduction schedule
- lease paymentsPeriodic charges for use
- rentPayment for temporary use
- insurance premiumsPeriodic payments for coverage
salaries · property taxes · software licenses · subscription fees · licensing fees · loan interest · annual fees · retainers
Distribution of shares
- projectionSomething that extends outward
- forecastingEstimating future conditions
- planningArranging for future events
- fiscal yearAccounting calendar period
estimation · baseline · contractual obligations · annual budget
No net gain
- contribution marginRevenue exceeding variable expenses
- volumeAmount of space filled
- sales targetAssigned revenue benchmark
- margin of safetyAllowance beyond what's needed
rent
Payment for temporary use
- salariesFixed regular payments for work
- insuranceContractual risk coverage
- utilitiesEssential infrastructure services
depreciation · lease · property taxes · maintenance · amortization · security · office supplies · cleaning services · administrative · facilities
depreciation
Asset value reduction over time
- amortizationGradual debt reduction schedule
- lease paymentsPeriodic charges for use
- rentPayment for temporary use
insurance premiums · salaries · property taxes · software licenses · subscription fees · licensing fees · loan interest · annual fees · retainers · membership dues
allocation
Distribution of shares
- projectionSomething that extends outward
- forecastingEstimating future conditions
- planningArranging for future events
fiscal year · estimation · baseline · contractual obligations · annual budget
break-even
No net gain
- contribution marginRevenue exceeding variable expenses
- volumeAmount of space filled
- sales targetAssigned revenue benchmark
short-run
Of limited duration
- long-runExtended future period
- expensesexpenses, expense, expenditure, costs, rent
- microeconomicsdemand, supply, supply and demand, price, market
- costsoverhead
- flat rate pricingset price, flat fee, standard rate
- economicssupply and demand, inflation, GDP, GNP, gross domestic product
- budget termsbudget, deficit, surplus, spending, revenue
fixed costvariable cost
Spending tied to output
marginal cost · direct cost · unit cost · direct labor · production cost
cost, fixed, fixing, fixer, fixed costs