MANAGERIAL ACCOUNTING >C<
MANAGERIAL ACCOUNTING >C<
3rd Edition
ISBN: 9781259948503
Author: Whitecotton
Publisher: MCG CUSTOM
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Textbook Question
Chapter 5, Problem 1Q

Define each of the following terms variable cost, fixed cost, step cost, and mixed cost. Give an example of each.

Expert Solution & Answer
Check Mark
To determine

Concept introduction:

There are three types of costs according to the unit of production; Variable, Fixed and Mixed. Variable costs change proportionally with the number of units produced and variable cost per unit remains constant. Fixed Cost remains same in totality irrespective of the number of units produced.

The mixed cost is the mix of variable and fixed cost, some of its part is fixed and some variable.

To discuss:

The meaning of each type of costs

Answer to Problem 1Q

The meaning of each type of costs is as follows:

  • Variable costs: Variable costs change with the level of activity.
  • Fixed Costs: Fixed costs remain same irrespective of the level of activity.
  • Step Costs: Step Costs remain same up to a level and change after that.
  • Mixed Costs: The mixed cost is the mix of variable and fixed cost, some of its part is fixed and some variable.

Explanation of Solution

There are three types of costs according to the unit of production; Variable, Fixed and Mixed. Variable costs change proportionally with the number of units produced and variable cost per unit remains constant. Fixed Cost remains same in totality irrespective of the number of units produced. The mixed cost is the mix of variable and fixed cost, some of its part is fixed and some variable.

The meaning of each type of costs is as follows:

  • Variable costs: Variable costs change with the level of activity.
  • Fixed Costs: Fixed costs remain same irrespective of the level of activity.
  • Step Costs: Step Costs remain same up to a level and change after that.
  • Mixed Costs: The mixed cost is the mix of variable and fixed cost, some of its part is fixed and some variable.

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Chapter 5 Solutions

MANAGERIAL ACCOUNTING >C<

Ch. 5 - Prob. 11QCh. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - Which of the following increases when activity...Ch. 5 - Prob. 2MCCh. 5 - Prob. 3MCCh. 5 - Consider the following information for a local...Ch. 5 - Prob. 5MCCh. 5 - Prob. 6MCCh. 5 - Prob. 7MCCh. 5 - Prob. 8MCCh. 5 - Prob. 9MCCh. 5 - Hathaway Corp, manufactures garden hoses. Last...Ch. 5 - Identifying Cost Behavior Heather Oak is trying to...Ch. 5 - Prob. 2MECh. 5 - Defining Cost Behavior Match each of the following...Ch. 5 - Prob. 4MECh. 5 - Defining Terms for the High-Low Method Indicate...Ch. 5 - Prob. 6MECh. 5 - Prob. 7MECh. 5 - Prob. 8MECh. 5 - Prob. 9MECh. 5 - Prob. 10MECh. 5 - Prob. 11MECh. 5 - Prob. 12MECh. 5 - Prob. 13MECh. 5 - Prob. 14MECh. 5 - Prob. 15MECh. 5 - Prob. 16MECh. 5 - Compare full absorption costing to variable...Ch. 5 - Identifying Cost Behavior Patterns Steve...Ch. 5 - Prob. 2ECh. 5 - Prob. 3ECh. 5 - Prob. 4ECh. 5 - Estimating Cost Behavior Using High-Low Method...Ch. 5 - Prob. 6ECh. 5 - Prob. 7ECh. 5 - Prob. 8ECh. 5 - Prob. 9ECh. 5 - Estimating Cost Behavior Using Scattergraph and...Ch. 5 - Estimating Cost Behavior Using Least-Squares...Ch. 5 - Comparing High-Low Method and Least-Squares...Ch. 5 - Preparing Contribution Margin Income Statement...Ch. 5 - Determining Cost Behavior, Preparing Contribution...Ch. 5 - Prob. 15ECh. 5 - Prob. 16ECh. 5 - Prob. 17ECh. 5 - Prob. 18ECh. 5 - Comparing Full Absorption Costing and Variable...Ch. 5 - Estimating Cost Behavior Using Least-Squares...Ch. 5 - Prob. 1.1GAPCh. 5 - Prob. 1.2GAPCh. 5 - Prob. 1.3GAPCh. 5 - Prob. 1.4GAPCh. 5 - Prob. 1.5GAPCh. 5 - Prob. 1.6GAPCh. 5 - Prob. 2.1GAPCh. 5 - Prob. 2.2GAPCh. 5 - Prob. 2.3GAPCh. 5 - Prob. 2.4GAPCh. 5 - Prob. 2.5GAPCh. 5 - Prob. 2.6GAPCh. 5 - Prob. 2.7GAPCh. 5 - Prob. 3.1GAPCh. 5 - Prob. 3.2GAPCh. 5 - Prob. 3.3GAPCh. 5 - Prob. 3.4GAPCh. 5 - Prob. 3.5GAPCh. 5 - Prob. 4.1GAPCh. 5 - Prob. 4.2GAPCh. 5 - Prob. 4.3GAPCh. 5 - Comparing Full Absorption and Variable Costing...Ch. 5 - Comparing Full Absorption and Variable Costing...Ch. 5 - Prob. 5.3GAPCh. 5 - Prob. 6.1GAPCh. 5 - Prob. 6.2GAPCh. 5 - Prob. 6.3GAPCh. 5 - Prob. 6.4GAPCh. 5 - Prob. 6.5GAPCh. 5 - Prob. 6.6GAPCh. 5 - Prob. 1.1GBPCh. 5 - Prob. 1.2GBPCh. 5 - Prob. 1.3GBPCh. 5 - Prob. 1.4GBPCh. 5 - Estimating Cost Behavior Using Scattergraph,...Ch. 5 - Prob. 1.6GBPCh. 5 - Prob. 2.1GBPCh. 5 - Estimating Cost Behavior Using Scattergraph,...Ch. 5 - Prob. 2.3GBPCh. 5 - Prob. 2.4GBPCh. 5 - Prob. 2.5GBPCh. 5 - Prob. 2.6GBPCh. 5 - Prob. 2.7GBPCh. 5 - Prob. 3.1GBPCh. 5 - Prob. 3.2GBPCh. 5 - Prob. 3.3GBPCh. 5 - Prob. 3.4GBPCh. 5 - Prob. 3.5GBPCh. 5 - Prob. 4.1GBPCh. 5 - Prob. 4.2GBPCh. 5 - Prob. 4.3GBPCh. 5 - Prob. 5.1GBPCh. 5 - Prob. 5.2GBPCh. 5 - Prob. 5.3GBPCh. 5 - Prob. 6.1GBPCh. 5 - Prob. 6.2GBPCh. 5 - Prob. 6.3GBPCh. 5 - Prob. 6.4GBPCh. 5 - Prob. 6.5GBPCh. 5 - Prob. 6.6GBP
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