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    Atkinson Costacc - LOPEZ, JOEBIN C.

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    Joebin Corporal Lopez
    The document discusses variable costs, fixed costs, and cost-volume-profit analysis. Variable costs change with activity levels while fixed costs do not. Total cost equals variable cost plus fixed cost. Cost-volume-profit analysis uses variable and fixed costs to identify profit at different activity levels.

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    Atkinson Costacc - LOPEZ, JOEBIN C.

    Uploaded by

    Joebin Corporal Lopez
    12 views1 page
    The document discusses variable costs, fixed costs, and cost-volume-profit analysis. Variable costs change with activity levels while fixed costs do not. Total cost equals variable cost plus fixed cost. Cost-volume-profit analysis uses variable and fixed costs to identify profit at different activity levels.

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    Atkinson Costacc- LOPEZ, JOEBIN C.

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    The document discusses variable costs, fixed costs, and cost-volume-profit analysis. Variable costs change with activity levels while fixed costs do not. Total cost equals variable cost plus fixed cost. Cost-volume-profit analysis uses variable and fixed costs to identify profit at different activity levels.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    12 views1 page

    Atkinson Costacc - LOPEZ, JOEBIN C.

    Uploaded by

    Joebin Corporal Lopez
    The document discusses variable costs, fixed costs, and cost-volume-profit analysis. Variable costs change with activity levels while fixed costs do not. Total cost equals variable cost plus fixed cost. Cost-volume-profit analysis uses variable and fixed costs to identify profit at different activity levels.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    VARIABLE COST- one that increases or decreases proportionately with the

    changes in the activity level of some variable.


    Cost driver- a variable that causes cost to either increase or decrease.
    Formula:
    VC= VC/unit x No. of CD units
    1.) Variable product costs
    2.) Variable period costs
    FIXED COST- also known as capacity-related cost is one that does not vary
    in a specified activity level.
    1.) Fixed product costs
    2.) Fixed period costs
    Therefore; TOTAL COST= VC + FC
    COST-VOLUME-PROFIT (CVP) ANALYSIS- is a useful tool that uses the
    concepts of VARIABLE and FIXED to identify the profit associated with
    various levels of activity.
    REVENUE= SELLING PRICE PER UNIT x NO. OF UNITS SOLD
    PROFIT= REVENUE – TOTAL COSTS therefore; PROFIT= REVENUE – VC
    - FC
    CONTRIBUTION MARGIN= TOTAL REVENUE – TOTAL VC
    CONTRIBUTION MARGIN RATIO= CONTRIBUTION MARGIN PER UNIT ÷
    SELLING PRICE PER UNIT
    - It is the fraction of a sales in peso that is available to cover fixed
    costs and produce a profit.

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