Fixed costs include items like rent ... referred to as "the bottom line" because it appears at the end of an income statement. It refers to the company's total profit after accounting for all ...

rather than being immediately expensed in the income statement. Absorption Cost per Unit = (Direct Materials + Direct Labor + Variable Overhead + Fixed Overhead) / Total Units Produced For example ...

Note: The income statement would capture variable and fixed expenses as well ... A person will pay far more for living costs in New York City than in rural areas in Middle America, for example.