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Unformatted text preview: variable/fixed. Rows- budgeted (end row totals)- actual (given)= unallocated Relevant Costs- avoidable costs- eliminated in whole or part. Sunk never relevant (depreciation, general OH, fixed) . Eliminate costs that do not differ. Materials- original cost- never relevant, replace- if keep buying, salvage- if leftover. Special Order- incremental rev- DM-DL-mold-var. oh= +?-? Constrained Resources- (CM/constrained resource allocation base) Joint product costs- revenue- costs= benefit. Ignore joint allocated costs. EX) Capacity=300,000, Sell Price=40, Var. cost=18, Fix cost=7, wants 50,000 for less than 39. A) operating at capacity: 18+ (1,100,000/50,000) =40. (40,39) No. B) operating at capacity can avoid $4 variable: 14+(1,100,000/ 50,000)= 36. (36,39) Yes . C)Not at capacity: 18. (18,39) Yes . D)Wants 20,000 heavy duty variable 27 operating capacity displace 22,000 regular batteries: 27+ (22x22000/20,000)= 51.2. (51.2,60). Yes....
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- Winter '08