Reference no: EM132438241

Question 1: If the Management of a firm had the discretion of categorizing a cost as either a product or period cost, which do do you think they would prefer and why? The use of a quantitative example to illustrate your response may be provided.

Question 2: Variable costs are said to remain at a fixed rate per unit in a "relevant range". Describe why or provide and example of how and whey variable cost per unit may increase or decrease at certain levels and that a variable cost line on a graph may not actually be linear and are actually curvilinier in the real world.

Question 3: This module predominantly dealt with cost classifications. Why do you believe it is so important for a firm's management to properly classify costs? What could be the result of a material improper cost classification?

Question 4: In contrasting a traditional format income statement to a contribution format income statement, which to believe would be more useful for management's and or external usage and why?