Costs Essay Example | Topics and Well Written Essays - 250 words - 1

Costs - Essay Example These include research and development whereby they are at the discretion of the managerial team in terms of manipulating them based on an already predetermined period, for instance, quarterly, monthly or annually. Hence, indicating this kind of fixed costs’ flexible nature contrary to the committed ones (Dunn, Sherwood, Stevens & Winston, 2013). Conversely, committed fixed cost, for instance, depreciation refer to long planning costs whose alterations may significantly affect continuity of a given firm. Hence, they are inflexible (Hartman, Vang & Cornwall, 2015). Firms normally rely in this knowledge in their quest to come up with concrete and quality decisions regarding what to produce. For instance, this is quite evident with â€Å"make or buy† situations whereby a given company ought to go for the most appropriate option that will guarantee it heightened profitability. In arriving to the required results, it utilizes all the relayed data contrary to visual fit method, which mostly leaves out some data. This is especially when intending to link certain points of data