You Have Been Asked to Design a New Climate Classification

question 21

Essay

You have been asked to design a new climate classification system.Will it be based on causative factors (i.e. ,a genetic classification)or statistics (i.e. ,an empirical classification system),or a combination thereof? What factors will you consider in your classification?

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Definitions:

Variable Expenses

Expenses that vary directly with the level of business activity.

Fixed Expenses

Costs that do not vary with the level of production or sales, such as rent or salaries.

Net Sales

Sales revenue less sales returns and allowances and less sales discounts.

High-Low Method

A technique used in management accounting and cost accounting to split fixed and variable costs based on the highest and lowest levels of activity.