#CryptoRoundTableRemarks Describe the various type of cost according to cost behaviour.

Or, Classify cost on the basis of significance and behaviour. [N.U. 2013 (Old)); 2018 (Mgt.); 2021 (Acc.)/

Ans: Cost in a resource sacrificed or forgone to active a specific objective, we can classify cost on the basis of significance and behaviour as under:

(i) Fixed cost: These costs remain fixed in total and do not increase or decrease with the volume of production. But the fixed cost per unit increase when the volume of production decrease and vice versa.

(ii) Variable cost: These costs change in proportion to the volume of production. In other words when volume of output increases, total variable cost also increase and vice versa. But the variable cost per Unit remain fixed.

(iii) Semi variable or semi fixed cost: These cost are partly fixed and partly variable. A semi variable cost has often a fixed element belong which it will not fall at any level of output and the variable elements either at a constant vote or in lumps.