MGT223H5 Chapter Notes - Chapter 6: Activity-Based Costing, Variable Cost, Fixed Cost
Document Summary
Ch 2 -3 all throughout cost of good manufacturing statement. Process costing question ch 4 do a production schedule or do parts. Ch 5 don"t worry about the appendix. Activity based costing system generally easier to set up and run than tradition system false: high low method. A = fixed cost: contribution margion variable costing does not conform w/ gaap. Manufacturing costs = many variable costs can be a combination of mixed costs (especially commission often a flat salary + variable portion of salary) Step variable cost = remains constant within narrow range of activity tends to look like fixed cost (e. g. labour workers) What does the term relevant range mean: range within which costs may fluctuate, range within which a particular cost formula is valid, range within which production may vary, the range within which relevant costs are incurred. Long term fixed costs that cannot be changed the short term. What would normally be considered committed or discretionary costs.
