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Fixed and Variable Costs: When Accounting Is the Opposite of Cash Flow Reality
Author(s) -
Lee Reginald Tomas
Publication year - 2016
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/jcaf.22158
Subject(s) - variable cost , cash flow , fixed cost , variable (mathematics) , business , economics , cash , cash flow forecasting , operating cash flow , actuarial science , accounting , econometrics , finance , mathematics , mathematical analysis
There are three things you will need to consider when seeing, understanding, and managing fixed and variable costs. First, you need to recognize whether the costs under consideration are cash or noncash costs. Second, you need to understand how and why the costs vary. And third, the implications of having costs that vary are all important to managing cash flow effectively. © 2016 Wiley Periodicals, Inc.