CPA BEC Cap budgeting tools

A cost that could be eliminated in whole or in part if a different course of action is taken that would either end the need for the activity or increase efficiency

A cost that differs between alternatives, also known as incremental cost or relevant cost.

A relevant cost in decision making but one for which information might not be available.

A type of product costing that assigns fixed overhead units produced as a product cost

A ratio of contribution margin to price computed as (P-VC), where p is price and vc is variable cost

The excess of actual or budgeted sales over sales at the breakeven point. It is the amount by which sales could decrease before losses occur

A type of product costing that assigns fixed overhead units produced as a product cost

Sometimes called breakeven analysis, key factors are revenues, fixed costs, and variable costs

Sales price less variable cost per unit

Total fixed costs divided by price less variable costs per unit

Total fixed costs divided by (price less variable costs divided by price)

Total fixed costs plus net income before taxes divided by price less variable costs