ACCT 210 1st Edition Lecture 1 Outline of Current Lecture I Managerial accounting II Four types of cost behavior a Variable b Fixed c Step variable d Mixed Current Lecture 1 Managerial accounting a Strictly internal b Does not adhere to GAAP Generally Accepted Accounting Principles unlike financial accounting 2 Four types of cost behavior a Variable i The cost per unit is the same the total cost increases Units Cost per unit Total cost 1 2 3 4 5 5 5 5 5 5 5 10 15 20 25 ii Cost per unit remains constant with change in volume 30 25 Total Cost 20 15 10 5 0 0 1 2 3 4 5 of units b Fixed i Total cost remains the same cost per unit changes Units Total Cost Cost per unit 1 2 3 4 5 12 12 12 12 12 12 6 4 3 2 40 14 12 Total cost 10 8 6 4 2 0 1 2 3 of units c Step variable d Mixed 4 5
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