Chapter 18, Problem 21DQ

To determine

Variable Cost:

Variable cost refers the cost which varies due to the change in the level of production. Higher production level refers higher the variable cost, and lower production level refers lower the variable cost.

Fixed Cost:

Fixed cost refers the cost which remains constant for particular time duration and there is no effect on it of the level of production.

To identify: The affect of increase in sale on the fixed cost and variable cost.