Week 2: Understanding Cost Behaviour

Get Started. It's Free
or sign up with your email address
Week 2: Understanding Cost Behaviour by Mind Map: Week 2: Understanding Cost Behaviour

1. 2.9 Allowing for a margin of safety

1.1. Margin of safety formulas

1.2. In terms of percent

2. 2.8 Calculating after-tax profit

2.1. Before tax profit

2.2. After-tax profit

3. 2.7 Applying break-even analysis

3.1. Break-even in terms of units

3.2. Break-even in terms of revenue

4. 2.6 Applying cost-volume-profit analysis (CVP)

4.1. assume a simple linear cost structure

4.2. Concept

4.3. Profit equation

5. Case study: MealKit4U

5.1. For each type of cost (fixed, variable and mixed), identify three examples that MealKit4U might have?

5.2. Maintaining a hotel room on average cost = $70. During off-season, reject an offer of $70 is a good decision?

5.3. Give examples of opportunity cost from your past decisions?

6. 2.5 Identifying relevant costs

6.1. Relevant costs

6.2. Sunk costs

7. 2.1 Understanding key cost terms

7.1. Key cost terms

7.1.1. Cost behaviour

7.1.2. Relevant range

7.1.3. Cost object

7.1.4. Cost driver

7.2. Key cost definitions

7.2.1. Fixed costs

7.2.2. Variable costs

7.2.3. Mixed costs

7.2.4. Relevant range

8. 2.2 Calculating average and marginal cost​

8.1. Average total cost

8.2. Average fixed cost

8.3. Average variable cost

8.4. Marginal cost

9. 2.3 Considering opportunity cost​

9.1. Opportunity cost >< Accounting cost

9.2. Economic profit >< Accounting profit

10. 2.4 Using the high-low method

10.1. Formular