Fixed Costs Example

The fixed costs or structure costs are the fixed movements that occur in specific periods that can be:

• Once a day
• Once a week
• Once a month
• Once every six months
• Once a year, etc.

This type of cost is essential for the movement of the company and must be taken into consideration when making business decisions. Its characteristic is that they do not alter the production of the company and must be applied precisely.

These costs do not change their amount when the company's production rises or falls.

5 examples of fixed costs:

1. A fixed cost can be the rent of a commercial premises or a warehouse, which must be paid on time, whether or not it occurs in the company and the cost will be fixed and specific, said cost must be paid according to the term that has been stipulated in the contract respective.
2. The hiring of a law firm to carry out (whether or not there are) the controversies, collections and movements that the company has; The corresponding fees or payments will be made in a timely manner, regardless of whether or not their services are required by the company.
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3. Telephone and broadband internet services, in the fixed and unlimited payment modality, where they pay a rent in a period regardless of the margin and number of calls made in the company or the information movements made through the network of Internet.
4. The rental of fleets of machinery, buses or automobiles, always independently of the corresponding use.
5. The payment of insurance against disasters or mishaps to which the company is obliged, which must be paid promptly, whether or not there is any incident.