Class 2 Flashcards
1
Q
Define Absorption Costing (Lay out 6 costs w/ relevant categories)
A
2
Q
What are service costs and why do we allocate them?
A
3
Q
Compare and contrast full absorption (manufacturing) cost, variable (manufacturing) cost, contribution margin, and gross margin.
A
4
Q
When we say a cost is “fixed” we are implicitly assuming two things. What are we assuming?
A
5
Q
Explain how a product can have a positive contribution margin but might be a product we would consider dropping from a financial viewpoint.
A
6
Q
Are all fixed costs sunk? Explain.
A
