The world of microeconomics and business decision-making hinges upon a key concept: marginal cost. In the simplest terms, marginal cost represents the expense incurred to produce an additional unit of ...

The high-low method is used in cost accounting to estimate fixed and variable costs based on a business's highest and lowest ...

Incremental cost is an important calculation for understanding numbers at different levels of scale. The calculation is used to display change in cost as production rises. If you manufacture one unit ...

A product's contribution margin tells you how much that product contributes toward paying your company's fixed costs -- and, once those costs have been covered, how much it contributes toward profit.

There are many costs associated with running a business, but all of those costs don’t fall into the same bucket. One type is overhead costs, which are expenses not tied directly to the production of a ...

Every business has operating expenses — that is, the costs of running the business. These expenses can generally be classified in two ways: Fixed expenses and variable expenses. Understanding the ...

One of the most important and challenging aspects of the bidding process is including the cost of machine usage. Many construction companies struggle to determine whether they should be including just ...