The relative proportion of fixed, variable, and mixed costs in an organization.
What is a cost structure?
100
Any materials that go into the final product.
What are raw materials?
100
Factory labor costs that can be easily traced to individual units of product.
What is direct labor?
100
the method of separating a mixed cost into its fixed and variable elements by analyzing the change in cost between the high and low activity levels.
What is the 'high-low' method?
100
The way in which a cost reacts to changes in the level of activity.
What is cost behavior?
200
Anything for which cost data are desired.
What is a cost object?
200
A cost that remains constant, in total, regardless of changes in the level of activity within the relevant range. If expressed on a per unit basis, it varies inversely with the level of activity.
What is a fixed cost?
200
A cost that can be easily and conveniently traced to a specified cost object.
What is a direct cost?
200
An income statement format that organizes into variable and fixed categories rather than being separated into product and period costs for external reporting purposes.
What is the contribution margin approach?
200
A variable that acts as a causal factor.
What is the independent in the cost equation?
300
A difference in cost between two alternatives.
What is a differential or incremental cost?
300
Direct labor cost plus manufacturing overhead cost.
What is conversion cost?
300
All costs that are involved in acquiring or making a product. In the case of manufactured goods, these costs consist of direct materials, direct labor, and manufacturing overhead.
What are product costs?
300
A detailed analysis of cost behavior based on an industrial engineer’s evaluation of the inputs that are required to carry out a particular activity and of the prices of those inputs
What is the 'engineering approach'?
300
It is expressed in the formula, Y = a + bx.
What is the cost equation?
400
A cost that is incurred to support a number of cost objects but that cannot be traced to them individually.
What is a common cost?
400
A cost that varies, in total, in direct proportion to changes in the level of activity but remains constant on a unit basis.
What is variable cost?
400
All manufacturing costs except direct materials and direct labor.
What is manufacturing overhead?
400
A method for analyzing cost behavior in which an account is classified as either variable or fixed based on the analyst’s prior knowledge of how the cost in the account behaves.
What is 'account analysis'?
400
A measure of whatever causes the incurrence of a variable cost.
What is the activity base?
500
the behavior that is observed whenever a straight line is a reasonable approximation for the relation between cost and activity.
What is linear cost behavior?
500
The range of activity within which assumptions about variable and fixed cost behavior are valid.
What is the "relevant range"?
500
Those costs that arise from annual decisions by management to spend on certain fixed cost items, such as advertising and research.
What are discretionary fixed costs?
500
A method of separating a mixed cost into its fixed and variable elements by fitting a regression line that minimizes the sum of the squared errors.
What is the least-squares regression method?
500
All costs that are incurred to secure customer orders and get the finished product or service into the hands of the customer.