Explain How Business Planning Helps Managers in a Firm

question 153

Essay

Explain how business planning helps managers in a firm.

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Definitions:

Variable Costing

An accounting method that includes only variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product costs and treats fixed manufacturing overhead as a period cost.

Operating Income

Income generated from regular business operations, excluding revenues and expenses from non-operating activities.

Inventory

The overall quantity of products and materials in possession of a company, intended for future sale or to be used in manufacturing.

Variable Costing

Variable Costing is a costing method that only includes variable costs (direct materials, direct labor, and variable manufacturing overhead) in product costs, excluding fixed manufacturing overhead.