Utility costs

Usage costs are the part of the fixed costs that describes the capacity used. The calculation is made with the help of the degree of employment.

Definition / explanation

In cost and performance accounting, the fixed costs are shown in Idle costs und Nutzkosten unterteilt. Während die Idle costs für den ungenutzten Teil als Begriff stehen, stellen die Nutzkosten den genutzten Anteil des Unternehmens und der Maschinen dar.

So they show the capacity utilization. Fixed costs such as wages or rent remain fixed, regardless of how high the capacity utilization of a company is.

Calculate utility costs

Since the utility costs are related to the working production, these can be compared to the fixed costs and the utilization can be recorded numerically. The formula for this is:

Usage costs = fixed costs x degree of capacity utilization

Capacity utilization rate

The capacity utilization rate can be calculated as follows:

Actual utilization: possible utilization

Summary

  • Usage costs are the part of the fixed costs that describes the capacity used
  • Calculation takes place with the help of the degree of employment
  • the unused part of the fixed costs is referred to as idle costs
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