Acc 561 Variable Cost Research Paper
Running head: VARIABLE COSTS
Variable Costs
ACC/561
June 12, 2012
Variable Costs
Any cost which is not fixed and will change in same amount when there is change in production volume is accounted as variable costs. This also means that they change in total rather than per unit whenever there is production or activity change. In production- labor, material or overhead could be the variable costs involved in the business. In Fitness center, there are different variable costs involved and each variable cost has its own unit and it changes with the change in the activity of that unit.
Cleaning Supplies: No customer would like to exercise or do workout if the workout area and machines are not cleaned properly. Therefore cleaning equipment is needed to clean machines and disinfect workout area on daily basis. The cost of supplies increases or decreases depending on how many customers attend the facility. If number of customers increases then the supply used for cleaning the area and equipment also increases (Attwood, 2011)
Water and Laundry costs: Cost involved in customers taking shower and using towels, after exercise also depends on how many customers took shower in facility. Water and laundry costs may vary each day depending upon customers.
Electricity Costs: This cost also depends on the operational …show more content…
Depending on their experience and expertise in starting and running of a business, they can always choose to go solo (Independent) or seek help from experienced and experts known as Franchise. If a business owner chooses to go for Franchise, apart from paying franchise fee, owners also have to follow many rules of franchisor, like merchandize setup, type of equipment, Training programs, number of employees, facility operational hours and many more. Like many fitness businesses, Snap Fitness also offers its franchise to different
Variable Costs
ACC/561
June 12, 2012
Variable Costs
Any cost which is not fixed and will change in same amount when there is change in production volume is accounted as variable costs. This also means that they change in total rather than per unit whenever there is production or activity change. In production- labor, material or overhead could be the variable costs involved in the business. In Fitness center, there are different variable costs involved and each variable cost has its own unit and it changes with the change in the activity of that unit.
Cleaning Supplies: No customer would like to exercise or do workout if the workout area and machines are not cleaned properly. Therefore cleaning equipment is needed to clean machines and disinfect workout area on daily basis. The cost of supplies increases or decreases depending on how many customers attend the facility. If number of customers increases then the supply used for cleaning the area and equipment also increases (Attwood, 2011)
Water and Laundry costs: Cost involved in customers taking shower and using towels, after exercise also depends on how many customers took shower in facility. Water and laundry costs may vary each day depending upon customers.
Electricity Costs: This cost also depends on the operational …show more content…
Depending on their experience and expertise in starting and running of a business, they can always choose to go solo (Independent) or seek help from experienced and experts known as Franchise. If a business owner chooses to go for Franchise, apart from paying franchise fee, owners also have to follow many rules of franchisor, like merchandize setup, type of equipment, Training programs, number of employees, facility operational hours and many more. Like many fitness businesses, Snap Fitness also offers its franchise to different