Prelim 2 Sheet_StudyGuide

Prelim 2 Sheet_StudyGuide - Contribution Margin=Total...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Contribution Margin= Total Revenues-Total VC CM Per Unit= Selling Price- VC /Unit CM%= CM per Unit/Selling Price. Gross Margin= Revenues-COGS Operating Leverage= Contribution Margin/ Operating Income—Effect of FC on changes in OI as Q changes. Normal/Standard Costing- Budgeted costs for all (DM,DL,OH) Overhead Assignment-Traditional- Allocate O/H on volume-based cost driver(DLS,DLH), Higher O/H and Lower DL, Some Costs aren’t Volume-Related Activity Based- Multiple Cost Drivers,Resource Consumption,Activities. Cost Allocation Base- factor that links in a systematic way an indirect cost or group of indirect costs to a cost object i.e.-Allocate costs on basis of machine hours used to produce different products Indirect Cost Rate= Total Indirect Cost/Budgeted Qty of Cost Allocation. Base Time Period Used to Compute Indirect Cost Rates: Numerator Reason-( Indirect Cost Pool)-The shorter the period, the greater the influence of seasonal patterns on the amount of costs. Denominator Reason- (Quantity of Allocation Base)-Long periods needed to spread monthly fixed indir costs over fluctuating levels of monthly output Cost Hierarchies - Unit Level -Performed for each unit of output. Batch Level- Each time a batch is produced.
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern