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How costs behave as the level of activity/volume changes. Why an understanding of cost behaviour is important ?
Types
Variable e.g. petrol, direct materials
Fixed e.g. car tax, factory rental
Semi-variable (Hybrid) e.g. phone bill. Cost separation is the process of separating the fixed and variable elements of a semi variable cost.
Methods
High – Low Method
Regression Analysis
Cost Separation
Why an understanding of cost behaviour is important ?
Unit Costing
Pricing
Decision Making
Budgeting
Break-even analysis
The Rohr Company’s old equipment for making subassemblies is worn out. The company is considering two courses of action: (a) Completely replacing the old equipment with new equipme
a certain company makes 3 products A,B and C and they use the same raw material zhong.details about each product is as follows.production units are 10 000 for A,8 000 for B,12 000
Compute the equ units of production?
Determine Cost pool and Cost drivers Cost pool: it is another name given to a cost centre and, therefore an activity cost centre may also be termed as an activity cost pool.
Hoe to find the cost of goods transferred under weighted average method
What are the duties of the Public Company Accounting Oversight Board?
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