Alan rents the factory
for £1,000 per month.
Fixed and Variable Costs
Alan pays himself a salary of
£24,000 per year.
Each jumper is made of wool.
Wool costs £5 per jumper.
Each jumper has three buttons.
which cost £0.50 per button.
Alan has an advert on local
radio for £45 each week.
Jumpers go into a packet when
they’re made. Each packet costs
Alan £1.00.
The factory’s electricity bill is
£150 every month.
Fixed Costs
1. Label all of the fixed costs around the
factory.
Alan pays back a loan at
£100 every month.
Variable Costs
1. Label all of the variable costs.
Total Costs
1. What is the formula for total costs?
2. List examples of variable costs:
2. List examples of fixed costs:
2. What are Alan’s total costs for 5000
jumpers (per month)? Show your working.
3. What are Alan’s fixed costs each month?
Show your working.
3. What are Alan’s variable costs per jumper?
Show your working.
4. What are Alan’s variable costs for 5000
jumpers? Show your working.
3. What are Alan’s total costs for 10,000
jumpers (per month)? Show your working.