UNIDAD EDUCATIVA PARTICULAR “SAINT DOMINIC SCHOOL”

“Formamos Personas Nuevas, Para un Mundo Nuevo”

Entrepreneurship

CLASSWORK

NAME: _Giuliana Valenzuela, Francisco Pérez, Adrián Ocaña, María Emilia Páez, Romina Herrera__ CLASS: 1 BGU “C”
DATE: _06/10/2021_

COST

In groups of up to 5 members
1.- Provide a definition for:

Fixed cost: They are values independent of production; it refers to the costs that the company incurs during the exercise of its
activity.

Variable cost: They are values that are directly related to production.

2.- In which case can water be a fixed cost, in which case can water be a variable cost?

Water can be a fixed cost, for example: when a company produces soda drinks, they need water to clean the bottles and to use it
as a part of the formula the company every month pay a bill for the service and the price of the bill doesn´t change.

Water can be a variable cost, when a company pays for the water service for cleaning and disinfecting their products and
depending on the demand of the product the use of the water change, when the production is high the water consume also would
be high and the cost of the water would be up, and when the product demand is low the cost of the water also would be low, so
this cost could change depending on the demand production of the product.

3.- In which case can the internet be a fixed cost, in which case can internet be a variable cost?

Internet can be a variable cost when a product that is made needs this to function or that carries Internet within its
characteristics, some products that carry Internet are smartphones, smart watches, laptops, cars, appliances, vehicles and any
other technological product.

On the other hand, the internet could be a fixed cost when it is used by the company in the administration part, in customer
service and it can also be used as a marketing tool.

4.- Select 2 products and suggest 3 fixed costs and 5 variable costs, provide an estimate price for every cost you
suggested. Calculate the total fixed cost and total variable cost for each product.

Vanilla Cake

 Fixed costs:
o Water service 20, 45 $
o Electricity 15, 50 $
o Maintenance of electrical utensils + 11, 25 $
47, 02 $
 Variable costs:
o Eggs 1,00 $
o Butter 1,09 $
o Sugar 2,00 $
o Milk 1,05 $
o Vanilla + 1,30 $

6,44 $

Car
 Fixed costs:
o Maintenance of the equipment used 15,30 $
o Employee salary 1200,00 $
o Product marketing + 10,50 $

1225,80 $

 Variable costs:
o Car engine 3000,00$
o Tires 48,00 $
o Brakes 80,00$
o Bodywork 50,00$
o Windshield or windows + 20,00$

3198,00$