9/23 Cost Behavior

Question 1

variable cost

Answer 1

costs in total it goes up, but it does not change as far as a per unit perspective
ex of variable costs:
merchandising - COGS
Manuf Companies - DM, DL, VOH
Merch & Manuf comp - commissions, shipping, clerical, etc
service - more activity
volume is on the x axis and cost is on the y axis

Question 2

fixed

Answer 2

doesn’t change with sales, but with more units it goes down

ex: longterm, cannot be significantly reduced in the short term

Question 3

step variable costs

Answer 3

resource that is obtainable in large chunks

Question 4

labor

Answer 4

is a variable cost depending on the country

Question 5

mixed costs

Answer 5

has both fixed and variable

ex: utility has a base cost no matter what but goes up as you use it

Question 6

scatter graph

Answer 6

drawing a base line with excel

Question 7

high low method

Answer 7

taking the highest x axis item and the lowest and drawing a line between the two
the slope is the unit cost and the base cost is the y intercept
this will be on a test

Question 8

contribution margin format

Answer 8

sales revenue
-variable costs
contribution margin
-fixed costs
net operating income