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The Behavior of Costs

16. The Behavior of Costs. Behavior of Costs. Cost-volume relationships : Fixed and variable costs Step-function costs. Relation of costs to volume. Higher volume causes higher costs : Variable costs = items of cost that vary, in total, directly and proportionately with volume

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COST-VOLUME-PROFIT RELATIONSHIPS

23. COST-VOLUME-PROFIT RELATIONSHIPS. Cost behavior CVP Analysis Break-even analysis. Variable Cost. Cost Behavior. Costs that vary in direct proportion to the level of activity. y = 1.21x R 2 = 0.98. Total cost - increases with activity Per-unit cost - remains nearly constant

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Unit fixed cost - PowerPoint PPT Presentation

The Behavior of Costs

COST-VOLUME-PROFIT RELATIONSHIPS