Frankin Corporations properties you with a summary of its total budgeted Production costs at...
Question:
Frankin Corporations properties you with a summary of its total budgeted Production costs at three product levels:
| Volume in units | |||
| 1000 | 2000 | 3000 | |
| Cost A | 5000 | 5000 | 5000 |
| Cost B | 1400 | 1800 | 2200 |
| Cost C | 3000 | 6000 | 9000 |
| Cost D | 2000 | 2000 | 2500 |
1. Indicate the cost behavior for Costs A through D.
2. What would be the total budgeted cost be for Costs A and C if the company produces 2,500 units?
Types of Cost:
Cost can have different natures like fixed, variable, step, and mixed. For businesses, it is essential to identify the nature of costs, to estimate budgeted costs.
Answer and Explanation: 1
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Table indicating the type of cost
| Volume in units | Type of Cost | Reason | |||
|---|---|---|---|---|---|
| 1000 | 2000 | 3... | |||
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Cost Behavior: Definition & Pattern Analysis
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Chapter 22 / Lesson 21
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Cost behavior is the change in total costs coming from business activities. Learn more about cost behavior, the definitions of fixed, variable, and mixed costs, and the pattern analysis for each type of cost.
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