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20 Cards in this Set
- Front
- Back
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batch related acivities
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activities triggered by the number of batches produced rather than by the number units manufactured
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break even equation
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unit sales= fixed costs/contribution margin per unit
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business sustaining activities
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activities required for the basic functions of the business. Doesn't matter about size of the organization
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capacity related resources
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resources paid for in advance. they give the organization the capacity to produce the good/service
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channel sustaining activities
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activites that keep product distribution channels open
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contribution margin
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a product's price - variable cost per unit
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cost object
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anything that is computed as a cost. as long as it has value to a company it is a cost object
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Cost-volume-profit analysis (CVP)
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how cost and profit vary with the change in volume
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customer accounting
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compares different segments of customers to decide if they are profitable, and if not, how to make them a profitable segment
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customer sustaining activities
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activities that keep the customer coming back, regardless of the product
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direct cost
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a cost of a resource that makes a single object. it is a main resource for the object aka leather for a leather coat
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fixed costs
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the cost that is applied to capacity related resources (machines). based on planned levels or production
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flexible resources
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resources whos use is proportional to the amount it is used aka steel mine and fuel
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indirect costs
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when a company has to pay a cost object to make a cost object aka paying a manager to make a cost product
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long run
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the period over which a capacity can be adjusted
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manufacturing costs
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the cost of all the resources used to make a product (raw materials + machines)
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opportunity costs
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the value sacrificed when you produce something else, there will always be oppertunity costs
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product costs
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the manufacturing costs of a period
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product sustaining activities
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acitivities that facilitate and keep production of products up and going
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variable costs
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costs of flexible resources
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