Type of Account System Which Organizes Costs of Key Activities

question 21

Short Answer

Type of account system which organizes costs of key activities to relate a related product or products is _______________.

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Definitions:

Committed Fixed Costs

Long-term fixed costs that cannot be easily altered in the short run, such as leases or contracts.

Fixed Cost Per Unit

A financial metric that represents the total fixed costs divided by the number of units produced. It decreases as production increases.

Variable Cost

A cost that varies in direct proportion to changes in the level of production or sales volume.

Cost Driver

A factor, such as machine-hours, beds occupied, computer time, or flight-hours, that causes overhead costs.