If I talk about cost structure then this is basically breaking down of total expenses and cost that are linked with running a particular business.This is one of the most detailed Framework which highlights multiple elements of cost like fxed cost,variable cost,direct and indirect cost

If I talk about importance of making cost structure in an entrepreneurshipthen it can be discussed as follows along with some of valid reasons;

• Cost structure is important for making informed decisions because it provides businessmans with accurate and concise understanding of their cost which enable them for making decisions properly related to pricing, investment and allocation of resources.

• Cost structure is important in controlling and reduction of cost by identification of some of the areas where there can be higher expenses so businessman can implement some of the measures that can save cost by optimisation of processes and elimination of unnecessary expenses.
• Cost structure is also helpful for entrepreneurs for setting their pricing technique or strategy by helping them in determination of minimum price at which they can think to their product or goods in market without significant losses.

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•If there will be properly structured cost then it will be crucial to secure investment or fund so it is demonstration for investors that really that particular businessman have accurate understanding about cost and he is also committed for management of these cost in an effective way.

• Entrepreneur can also get competitive benefit in market when he will optimise his cost structure of business because after that we can also offer minimum prices that can improve profit and investment in growth initiatives too.

If I conclude it then cost structure is most effective for businessman so that they may enable management of their costs,they may make informed decisions and ultimately they may drive growth for their business.

If I talk about some of the businesses that use cost structure method then these are below;

Fixed Cost Structure: Walmart

Walmart is an example of business which is using coast structure method and this is using fixed cost structure because of its giant investment in real state, inventory and logistics.but by diversification of these fixed because at large volume for selling this business can achieve scale economics and his business can also find it helpful in maintenance of minimum prices for their customers.

Variable Cost Structure: Uber

Uber is a platform that provides ride to customersso if I talk about its cost structure then this is of variable type because course that are linked with it are depending on number of rights that are provided.Costs of Uber ride include fuels maintenance in scientist for drivers which alters with number of rides. This variable cost type of structure is permitting uber for adapted scaling of their operations as a response for alternations jn demands.

Direct Cost Structure: Dell

If I talk about Dell then it is a computer manufacturing business which is using direct type of cost structure because costs are linked with production of each computer in a direct way.Direct costs of DELL consists of costs of components, labors and overheading of manufacturing process. By management of these direct coast properly business can maintain a competitive level of pricing and can obtain high profit margins.

Indirect Cost Structure: Amazon

If I talk about Amazon then its giant of E-commerce field which is using in direct post structure method because cause have no direct relationship with production of products of individuals because this business include marketing researching development and administrative expenses. If I say that post are spreaded at Amazon product portfolio which is very vast then it permits company for maintaining minimum prices and making investments for growth of business.

If I talk about elements that are present in cost structure along with their examples then these are below;

Cost structure elements can be divided into multiple categories;

Fixed Costs

If I talk about fixed cost then they remain similar and no change occurs in them,even if there are any changes in business production or products production like increase or decrease of a product.Their examples can be;

• Rent and daily usage products
• Salaries and daily wages
• Insurance premiums
• Depreciating and amortizating

as a practical example you can since that there is a company which is paying 10000 in one month in rent irrespective of number of units that are producing each month.

Variable Costs

if I talk about variable cost then these are indicated by their name that they alters in a direct way depending on level of production or level of sales. If I given example then following examples can be helpful to understand this thing.

• Raw materials and supplies
• Costs that are labor related (if sticks with production levels)
•.Expenses that are related to marketing and Advertisment
• Costs that are about shipping and handling of costs.

If I give a practical example then you can suppose that there is a company who is pained 6 USD per unit for production of raw materials and is producing 1200 a units in one month.

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Direct Cost

if I talk about direct post then they have direct relationship with specific products goods, services or project. If I give an example about it then these are below;

• Costs that are labor related (if tieding with particular project)
• Materials and supplies
• Costs that are qquipment and machinery related.
•Traveling and training costs

if I give up practical example then you can suppose that there is a company which is assigning a project manager to another project and salary of project manner is linked to that project in a direct way.

Indirect Costs

If I talk about indirect posts then these are those which have no direct relationship with particular product services or project so in these examples I can write the following;

• Costs related to administer salaries.

• Cost related to advertisement and marketing
• Cost that are rent and utilities related (if these are not linked directly with production)

If I give a practical example then you can support that there is a company who is complain that is marketing related for promotion of their products so here cost can't be linked directly with a single product.

I am breaking down cost structure in this way according to homework scenerio;

Fixed Costs

• Rent can be considered as $500 each month
• Equipment that can include ovens, blenders, mixers, etc can be included with $1,000 cost for each month
• Insurance expenses can be added as $200 for each month
• If I talk about expenses related to marketing and advertising then these are $300 each month I am including.

Now Total fixed costs are around $2,000 for each month by adding all above costs written

Variable Costs

• Ingredients like flour, sugar, eggs, etc can be at around $10 for each cake that is making.
• Costs of Labor for per cake making can be calculated at around $15 per hour
• Costs for packaging can be considered at around $2 for each cake

Now if I talk about total variable costs for each cake then these can be around $27.
If I talk about total variable costs each day for making 5 cakes then these are around $135
If I talk about total variable costs for each month and if production is in 25 days then then total costs can be around $3,375.

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Semi variable costs

• If I talk about daily usage things like electricity, water, etc then their total costs can be at around $100 for each month which is fixed rate + $0.10 per kilowatt-hour which is variable rate that may vary.
• Now if I talk about total semi variable costs for eacg month then these may be around $100 which is fixed and $50 which is alterable or variable by making an assumption of 500 kilowatt-hours for each month it's around $150

Total Costs

• Fixed costs are $2,000 for each month
• Variable costs are $3,375 for each month
• Semi-variable costs are$150 for each month
• Total costs are around $5,525 for each month

Revenue and Profit

• If I talk about price at which each cake is selling then it's around $50

• • If I talk about total revenue generated for each day for 5 cakes then it's around $250
  • If I talk about total revenue generating per month then it's around $6,250 by making an assumption again that there are 25 days of production from 30 days of month.
  • If I talk about total profit generating for each month by making an assumption of 25% profit margin we have obtained $1,562.50 as outcome by multiplying of $6,250 x 0.25.

This cost structure is helpful in providing a detailed breakdown of bakery fixed, variable, and semi-variable costs with generated revenue and profit.

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