For most folks, the most important aspect of the income statement is the variable cost, which consists of the cost of fixed assets such as plant, equipment, and labor.
This means that a variable cost is the total cost of all inputs used by all workers in a job. For example, in our example of the building of a new home, the variable cost would include all of the costs for materials and labor that go into the construction of a house, including the labor that was used to build the walls. This includes the cost of all the materials that were used, the cost of the labor that was used, and the cost of all the equipment used.
A variable cost is a cost that varies depending on the variable. For example, we could say that the variable cost of all the labor used in building the walls of a home is a variable cost because the cost of labor varies depending on the amount of work that is being done. In the example of a new house, the variable cost of all the materials used in building the walls of a home is a variable cost for that reason.
Variable costs could include labor (e.g., labor of a plumber or electrician), materials (e.g., lumber), and other fixed costs that cannot be changed. Variable costs are fixed costs that are not dependent on the amount of work done. In the example of the materials used in building the walls of a home, it is not clear what variable costs are included in this particular example.
The variable costs in the variable cost of a building are the cost to build the walls of a home e.g., labor e.g., labor of a plumber or electrician, and other fixed costs.
Variable costs are a variable cost that is not dependent on the amount of work that is being done. For example, in the example of a plumber or electrician, it is not clear what variable costs are included in this example.
The word “cost” in the word “income” is not a word that is used for anything but building the walls of your home. You are paying for the time required to get a home from the builder to the builder. So the cost of building a home is an additional cost (i.e. a fixed value) that the builder has to pay to get the home.
The other term for variable cost is fixed cost. It is a part of the total cost of the project. For example, an electrician or plumber will be called a fixed cost. A plumber’s or electrician’s “variable cost” is a part of their total cost.
It is one of the five categories on the income statement. There are nine of them, but they are all linked. The difference between the five categories is the total that the builder has to pay (fixed cost) as opposed to the cost of the materials that go into the home (variable cost). Therefore, a plumber or electrician would be a fixed cost and a bricklayer would be a variable cost.
The income statement lists every variable cost you’ll have, including the plumber, electrician, and bricklayer. The only variable cost that the builder will not be paid is the materials cost of the home. It’s this cost that is the variable cost for the builder.