Managerial Accounting & Job-Order Cost

Absorption costing

A method for accumulating fixed and variable costs associated with a production process.

Sales revenue minus variable expenses is

Contribution margin

Individual costs change as the level of activity level increases or decreases.

Cost behavior.

Any item for which cost data is desired is called a

Cost object

The relative proportion of each type of cost in an organization is known as the company's

Cost structure.

Conversion costs

DL+Man. OH

A change in revenues between two alternatives is known as

Differential revenue.

Prime costs

Expenses for materials and labor used in production.

Period costs are expensed when

Incurred

Product costs are also called

Inventoriable costs

The high-low method

Is based on the rise-over-run formula

The document that records the materials, labor, and manufacturing OH costs charged to a job is the

Job cost sheet

Period costs are

Nonmanufacturing costs

Contribution margin is

Sales revenue minus variable costs

Contribution margin

Sales-variable costs

Mixed costs are also commonly known as

Semi-variable costs

The relationship between mixed costs and the level of activity can be expressed by the

Straight-line equation

Costs that have already been incurred and can nit be changed by decisions made at any time are

Sunk costs

Differential cost is

The difference in cost between two alternatives Also know as incremental cost

Differential revenue

The difference in revenues between two alternatives.

When using the high low method, the change in cost divided by the change in units is

The variable cost per unit.

Within the relevant range, ______ costs remain constant on a per unit basis.

Variable

Within the relevant range of activity, variable costs

Vary in total, but remain constant per unit.

A fixed cost remains fixed ______ within the relevant range of activity.

in total