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19 Cards in this Set
- Front
- Back
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Contribution |
Contribution = Selling Price - VC |
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Breakeven Point (BEP) |
B.E.P. = FC/(Sales-VC) or B.E.P.= FC/Contribution |
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Co/S Ratio |
Co/S Ratio (or Margin) = Contribution/Sales |
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Breakeven Sales (BeSales) |
BeSales = FC/Co/S Ratio or BeSales = BEP * selling price per unit |
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Margin of Safety (MOS) |
MOS = Budgeted Sales - BeSales |
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At Break-even [P;FC;VC] |
• Profit = Zero • FC = Contribution • VC Ratio = 1-Co/S |
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Output required for Target Profit |
(FC+Target Profit)/Contribution unit |
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BeSales - Multiproduct - with production mix maintained |
= FC/Weighted average Co/S Ratio where Weighted average Co/S = Total Contribution/Total Sales |
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BeSales Multiproduct without a specific mix ratio |
Step 1 - Rank the contributions Step 2 - Calculate the BeSales in highest order of contribution until required contribution to equal the Fixed Costs |
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Overhead Absorption Rate (OAR) [overheads = indirect costs] |
OAR = Overhead Costs / Activity Level |
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Cost Driver Rate (CDR) [under ABC] |
CDR = Cost Pool / Activity Level |
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Time Series Forecasting (TS) - additive model - multiplicative model |
Additive model: TS = Trend + Seasonal Variations Multiplicative model TS =Trend * Seasonal Variatons |
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Material Price & Usage Variance |
Material Price Variance a.s.a.a. Material Usage Variance s.s.a.s |
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Advanced Variance Analysis - Mix & Yield |
Method with inputs: DMPV = QaPs - QaPa [a.s.a.a.] DMYV = QsPsMs - QaPsSs [s.s.s. - a.s.s.] DMMV= QaPsMs - QaPsMa [a.s.s. - a.s.a.] SYR = Output/Input [O.I] where, Q = material; P = Price; M = Mix SYR = Standard Yeld Rate [needed to calculate QsPsMs] For mix ratio always take inputs |
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High-Low Method |
High-Low Method splits mixed costs into fixed and variable costs. VC = Δ$/Δ# |
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Expected Value with Probabilities (Decision Tree) |
EV = Σ P(x) where: x = the event P = probability; ΣP = 100% Probability branches - always add up to 100% [EV = 0,25*x1 + 0,40*x2 + 0,35*x3] |
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Single Limiting Factor Analysis (3 Steps) |
Step 1: Determine the Limiting factor (Bottleneck resource) Step 2: Rank products by contribution/limiting factor unit Step 3: Allocate the resources |
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Cost Driver Rate (ABC) |
Cost Driver Rate = Total Cost Pool / Total Quantity of Cost Driver Consumed |
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Residual Income (RI) |
RI = ROI - Cost of capital |
