Page 303 - Fire Insurance Ebook IC 57

The Insurance Times

of business transacted, which cannot be
reduced in direct proportion to any reduction
of business.

E.g, Taxes, Bank Interest, Salaries of permanent
staff etc.

(c) Gross Profit - Standing Charges and Net
Profit together constitute the gross profits of
business.

(d) Turnover - The turnover constitutes the following
three elements:
(i) Variable charges - These are expenses
incurred in producing the goods which vary
in direct proportion to the volume of business
transacted.
(ii) Standing Charges - These are the fixed
expenses in amount irrespective of the volume
of business transacted or which cannot be
reduced in direct proportion to any reduction
of business. E.g, Taxes, Bank Interest, Salaries

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