Cost Behavior
Refers to the manner in which a cost changes as a associated activity changes.

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Activity BasesActivities that are thmust relate to the cost incurred.
Relevant RangeThe arrays in the activity in which the alters in the price are of interemainder.
3 common classifications of expense behaviorvariable cost, fixed price, and also mixed cost.
Variable CostCost that differ in propercent to transforms in the level of task. Increase and decrease proportionaly w/ task level. They are the very same per unit, while the full variable cost transforms in propercentage to alters in the activity base.
Fixed Costcost that reprimary the exact same in complete dollar amount as the level of activity alters. Increase and also decrease inversly via activity level per unit-amount
Mixed CostContains variable and also solved price.
Cost-volume profit analysisThe systematic examicountry of the relationship among offering prices, sales and manufacturing volume, prices, prices, and profits
contribution marginthe excess of sales revenue over variable cost. It offers understanding to the profit potential of a firm. Contributes to spanning solved cost.
contribution margin ratioIndicates the percent of each sales dollar accessible to cover the solved expense and also provide earnings from operations. Many useful as soon as the rise or decrease in sales volume is measured in dollars.
Unit Contribuution MarginSales price per unit less the variable price per unit.Many advantageous for increase or decrease in sales devices.
Break Even PointThe level of operations at which a business's revenues and also expires cost are exactly earnings or loss. Fixed cost over unit contribution margin.
Taracquire ProfitFixed Cost plus targain profit over unit contribution margin.
Absorption Costing Income StatementCost of Manufactored items contain DM, DL, Variable FOH, Fixed FOH
Direct Costing Income StatementCost of Manufactored goods conatains DM, DL, Variable FOH. Composed only of var. cost which increase or decrease as the volume rises or drops.
Manufactoring Margin (Var. Costing)Sales less the variable cost of products sold
If units offered are much less than systems producedVariable Costing Income Statement will be less than Absorption Costing Income Statement
If devices marketed are greater than units producedVariable Costing Income will certainly be greater than Absorption Costing
BudgetCharts a course for a company by outlining the plans of the organization in financial terms
Budgeting InvolvesEstablishing certain goals, executing plans to accomplish objectives, and periodically comparing actual outcomes through the goals
budgetary slackto plan lower purposes that might be possible
goal conflictoccurs when individual self-interest differ from organization objectives
Continuous budgetingA variation of fiscal year budgeting that maintains a 12 month projection right into the future. Continually revised with precious data
Zero-based budgetingrequires managers to estimate sales, production, and various other operating information as though sales are being started for the initially time
Static Budgetmirrors the meant outcomes of a obligation center for just one activity level. Onve budgain is determined it is not changes, also if activity transforms.

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Flexible Budgetshows meant results for numerous activity levels.
Sales budgetshows for each product the amount of estimated sales and the meant unit marketing price. Typically reported by area or sales representatives
Production BudgetThe number of units to be manufactored to fulfill budgeted sales and also inventory needs for each product is set forth