IMPACT OF MANAGING VARIABLE AND FIXED COSTS ON FIRM PROFITABILITY

Mamajonova Dilafro‘z Turg‘unboy kizi

Authors

Mamajonova Dilafro‘z Turg‘unboy kizi "TIIAME" National Research University Teaching assistant, Department of Accounting and Auditing

Keywords:

variable costs, fixed costs, firm profitability, cost management, cost-volume-profit analysis, break-even analysis, managerial accounting, Uzbekistan, industrial enterprises, operating leverage.

Abstract

This article examines the impact of managing variable and fixed costs on firm profitability in industrial enterprises. The study analyses how the accurate classification and control of costs — into variable and fixed components — directly influences enterprise profit margins, pricing decisions, and break-even performance. Using theoretical frameworks, comparative analysis, and statistical data from Uzbekistan’s industrial sector for 2021–2024, the research demonstrates that enterprises with structured cost management practices achieve significantly higher profitability ratios than those relying on undifferentiated cost control. The paper identifies critical barriers to effective cost classification, proposes a practical management framework, and presents a cost-volume-profit model adapted to the Uzbek business context.

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