What Are Controllable Costs

question 97

Multiple Choice

What are controllable costs?

• A)Costs a manager has no authority over.
• B)Costs a manager cannot avoid.
• C)Costs a manager does not participate in authorizing.
• D)Costs a manager can influence through decision making.

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Definitions:

Margin of Safety

The difference between actual or projected sales and the break-even sales level, used to assess risk and financial stability.

Variable Costs

Financial outlays that adjust based on the quantity of products made or the scale of sales transactions.

Fixed Costs

Business expenses that do not change in proportion to the level of goods or services that a company produces over a short term.

CVP Income Statement

A financial statement that shows the effects of changes in cost and volume on a company's profits, based on Cost-Volume-Profit analysis.