When Benchmarking,it Is Best When Management Accountants Simply Analyse the Costs

question 83

True/False

When benchmarking,it is best when management accountants simply analyse the costs and allow management to provide the insight as to why the revenues and costs differ between companies.

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Definitions:

Cost-output Elasticity

A measure of how responsive the cost of production is to a change in the output level.

Marginal Cost

The added expense incurred upon producing one further unit of a good or service.

Average Cost

The total cost of production divided by the quantity of output produced, indicating the cost per unit of output.

Short-run Cost Function

A relationship between production cost and output level when one or more inputs are fixed, typically analyzing costs within a time frame that doesn't allow for all factors of production to be adjusted.