Briefly Describe the Four Main Components of a Business Model

question 66

Essay

Briefly describe the four main components of a business model. Identify the subcomponents of each the four main components of a business model.

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Definitions:

Flexible Budget

A budget that varies or adapts based on fluctuations in activity or volume levels.

Indirect Materials Cost

The cost of materials used in the production process that cannot be directly traced to the product, such as lubricants and cleaning supplies.

Machine-Hours

A measure of production output or used capacity based on the number of hours machines are operated.

Spending Variance

The difference between the actual amount spent and the budgeted amount for a particular period, used in budget control and analysis.