Why might it be misleading to show the fixed costs on a per unit basis?

Q: ‘Costs maybe classified in a different type of behavioural costs such as variable and fixed costs…

A: solution : concept : variable costs               variable costs are those costs which varies along…

Q: how does the contribution margin pricing method differ from ratio pricing method?

A: The question is based on the concept of pricing policy and methods. The product's price can be…

Q: ost flow methods and assumptions. What

A: The different cost flow methods and assumptions are as follows: FIFO LIFO Weighted average

Q: what is an indirect cost and how is it different than a direct cost?

A: Indirect Cost: Indirect costs are the costs of doing business that are not easily identified with a…

Q: If fixed costs must be incurred during a given period, shouldn't they be expense during that period?…

A: INTRODUCTION Fixed costs are the cost which doesn’t change with the changes in level of production.…

Q: In applying the high-low method of cost estimation to mixed costs, how is the total fixed cost…

A: Mixed cost also called the semi variable cost . Mixed cost contains both fixed and variable cost .…

Q: Does the concept of the relevant range apply to fixed costs? Explain.

A: Fixed Cost: It is a cost which is constant in the short run, it is not related to any change in the…

Q: What are some factors that affect variable costs?

A: Variable costs: A variable cost is a business expenditure that varies in proportion to manufacturing…

Q: Why is there a need to separate mixed cost as to variable & fixed cost?

A: Variable cost: these are the costs which vary with the units produced. These costs increase by…

Q: What can be the Direct-Variable Costs? Explain. What can be the Direct-Fixed Costs? Explain. What…

A: Direct variable cost are those cost incurred in line with production or for a particular product or…

Q: How can the WACC be both an average cost and a marginal cost?

A: Weighted average cost of capital is the aggregated cost of capital with respect to the weights or…

Q: What is the similarity of fixed costs with variable costs and its differences.

A: similarities and differences of fixed cost and variable cost are discussed in step 2

Q: What is the relevant range? What role does the relevant range concept play in explaining how costs…

A: Relevant range refers to the level of the activity which represents the maximum and minimum limits…

Q: what are the differences between the FIFO, LIFO, and the average cost?

A: Inventory: It refers to the items held by an organization which were in various forms like raw…

Q: What is a fixed cost? Give an example.

A: Fixed Cost: Fixed costs are those costs which remain unchanged even there is a change in the…

Q: What effect does an increase in volume have on—c. Total fixed costs?

A:

Q: What are costs that have characteristics of both a variable and fixed cost?

A: A cost that has characteristics of both a variable cost and a fixed cost is called a mixed costs or…

Q: What is the difference between absorption-costing income and variable-costing income?

A: The income statement is prepared to record the revenues and expenses of the current period.

Q: What are the arguments in favor of treating fixed manufacturing overhead costs as period costs?

A: Period costs: Period costs are the costs other than the product costs. These costs are not incurred…

Q: How does Lean Production reduce or eliminate the difference in reported net operating income between…

A: Absorption Costing: Absorption costing is a method for calculating the full cost or total cost of a…

Q: What is a relationship between fixed, variable and semi-variable cost?

A: Cost can be defined as the amount incurred upon the production of goods and services for the final…

Q: Direct costs can be referred to as fixed costs. True or False?

A: Cost are divided into two parts which are, (1) Direct cost (2) Indirect cost Direct costs are the…

Q: Why is fixed costs changing?

A: In the given problem some estimates related to selling price and cost to be incurred are given and…

Q: Which of the following is not a step st driver rate by the volume of cost w to reduce the costs of…

A: Explanation: Activity based costing is a costing  technique where production is split into different…

Q: Why is the term direct costing a misnomer?

A: Direct Costing:The direct costing or variable costing is a method used to allocate the fixed…

Q: What is the difference between total costs and marginal costs?

A: Total cost is the total economic cost of production. Variable cost changes according to the quantity…

Q: What circumstances might create distortions where estimated costs are not an accurate representation…

A: The estimated costs are the costs determined through the estimation process on past…

Q: Why can unitized fixed costs cause errors in decision making?

A: Decision making process: Decision making process requires an understanding of a grasp of illegal…

Q: How does the length of the time horizon affect the classification of a cost as fixed or variable?…

A: Cost are being classified as variable and fixed normally. It is necessary to bifurcate the cost in…

Q: What effect does an increase in volume have on—a. Unit fixed costs?

A: Fixed costs are those costs of business which remain fixed in total irrespective of change in volume…

Q: What is the relationship among fixed costs, contribution margin, and thebreak-even point?

A: Fixed costs: These are the costs incurred by the organization irrespective of the volume of…

Q: What is a fixed cost? A variable cost? A mixed cost? Give an example of each

A: Costs are the expenses incurred in business. It means costs incurred for the manufacturing of…

Q: In what sense is the WACC an average cost? A marginal cost?

A: Weighted average cost of capital is the firm's cost of capital which is based on proportion of each…

Q: Which of the following describes the behavior of total variable and total fixed costs when level of…

A: Different costs associated with production process are - Fixed cost and variable cost. For example:…

Q: Using the high-low method, what is the fixed costs?

A: High Low Method- This method is used when Mixed costs are given which includes both Variable cost…

Q: What are direct out-of-pocket costs

A: There are various types of costs, some of which may be reimbursed and others that may not be. Direct…

Q: What are the advantages and disadvantages of Standard costing system when the labor rate us fixed?

A: Definition: Standard Costing: Standard costing is an accounting tool that is used to measure the…

Q: Why are fixed-overhead costs sometimes called capacity-producing costs?

A: Overhead costs Overhead cost or overhead expenses refer to the cost which is used to increase the…

Q: Differences in operating income between variable costing and absorption costing are due solely to…

A: Absorption costing: It refers to the method of product costing in which the price of the product is…

Q: How does the fixed cost per unit change as the level of activity (or cost driver) increases? Why?

A: Fixed cost refers to such overheads that are not directly related to the business and which do not…

Q: what is the definition of fixed, variable, and mixed costs? Are variable costs or fixed costs easier…

A: Introduction: Cost accounting is a type of managerial accounting that capture a firm's production…