Know the value chain What is a sunk cost? 2 3 4 5 Calculate Unit Contribution Ma
ID: 2535223 • Letter: K
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Know the value chain What is a sunk cost? 2 3 4 5 Calculate Unit Contribution Margin. 6 What is a period cost? 7 Know batch level, facility level, unit level, product level costs. 8 Contribution Margin less fixed expenses ? 9 What is the formula for the mixed cost equation? 10 What is the formula to calculate quantity of direct materials to purchase from the direct 11 materials budget? 12 What items are included on the combined cash budget? 13 Characteristics of the Balanced Scorecard 14 (Financial, Customer, Internal Business, Learning and growth) 15 what is the difference between a favorable and unfavorable variance? 16 What are the methods for analvzing capital investments Payback, IRR, NPV, ARR, time value of money, annuity 17 What factors may cause a favorable direct materials price variance? What could cause and unfavorable quantity variance?Explanation / Answer
VALUE CHAIN :- the process or activities by which a company adds value to an article, including production, marketing, and the provision of after-sales service.
WHAT IS SUNK COST :- In economics and business decision-making, a sunk cost is a cost that has already been incurred and cannot be recovered. Sunk costs (also known as retrospectivecosts) are sometimes contrasted with prospective costs, which are future coststhat may be incurred or changed if an action is taken.
CALCULATE UNIT CONTRIBUTION MARGIN :- In the example, if the company produces 300,000 widgets during the period, then $400,000 divided by 300,000 units equals about $1.33 per unit variable costs. 4. Subtract the per unit variable cost from the sales per unit to calculate the unit contribution margin.
WHAT IS PERIOD COST :- A period cost is any cost that cannot be capitalized into prepaid expenses, inventory, or fixed assets. Aperiod cost is more closely associated with the passage of time than with a transactional event. ... Instead, it is typically included within the selling and administrative expenses section of the income statement.
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