Automatic Data Processing Inc. (ADP) is a global business outsourcing services provider headquartered in Roseland, N.J. ADP is one of the largest payroll outsourcing providers in the world, and was an early adopter of a cloud computing operating model. According to executives, the vendor cuts paychecks for one in six Americans.
The reverse of fixed costs are variable costs, which vary with changes in the activity level of a business. Examples of variable costs are direct materials, piece rate labor, and commissions.
To understand gross profit, it is important to know the distinction between variable and fixed costs. Variable costs are those things that change based on the amount of product being made and are incurred as a direct result of producing the product. Variable costs include: Materials used. Direct labor. Packaging.