FIXED COSTS Definition

FIXED COSTS are operating expenses that are incurred to provide facilities and organization that are kept in readiness to do business without regard to actual volumes of production and sales. Fixed costs remain relatively constant until changed by managerial decision. Within general limits they do not vary with business volume. Examples of fixed costs consist of rent, property taxes, and interest expense.

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RETURN ON NET WORTH see RETURN ON STOCKHOLDERS EQUITY.

LIMITING FACTOR is a factor or condition that, either temporarily or permanently, impedes goal accomplishment.

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