Examlex
OSA involves:
Contribution Approach
A managerial accounting method that separates fixed costs from variable costs to determine the contribution margin per unit and overall contribution towards fixed costs and profits.
Differential Cost
The difference in total cost that will result from selecting one alternative over another.
Contribution Margin
The difference between sales revenue and variable costs, indicating the amount available to cover fixed costs and generate profit.
Variable Administrative Expenses
Expenses within the administration sector that fluctuate with the level of business activity, like sales commissions.
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