Question

assume that you are an entrepreneur of a hotel what are the fixed and variable cost to be carried out in that business?

Answer 1

Fixed costs are predetermined expenses that do not vary with output or how the business is performing.

Some examples of fixed costs to be carried out in a hotel include:

• Rent
• Telephone and internet costs
• Insurance
• Employee Salaries
• Loan Payments
• License

Variable costs changes over a specified period and are based on the business performance and the volume of services the business generates.

Some examples of variable costs to be carried out in a hotel include:

• Commissions
• Taxes
• Hourly wages.
• Food.
• Water and electricity utilities.
• Transport and delivery.