Flashcards
AAT3 Costs and Revenues
Cards in this deck (8)
- 1—Variable Costs change with level of production
- 2—Fixed costs are constant and do not change with production
- 3—Stepped fixed costs change with level of production but in a stepped manner
- 4—Semi-variable costs have an fixed element and variable element, for example, you may pay for telephone rental but then costs vary with use
- 5Direct CostsTraceable directly to a cost unit made up of:
Direct material
Direct Labour
Direct Overheads
The total of these is called the
prime cost per unit - 6Indirect costsIndirect Costs are those that cannot be identified with any one finished unit.
Indirect material – cleaning products
Indirect Labour – the production line supervisor
Indirect Overheads – rent, rates, electricity - 7Production CostsCost of Sales are also known as production costs. This category could include production labour, materials, supervisor salaries and factory rent
- 8Non-production costsNon-production costs includes distribution such as sales team commission and delivery costs.
Administrative costs are also classified as non-production costs such as head office costs, IT support, HR support and accountants.
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- Description
- Flashcards describing the different elements costs can fall into...for costs and revenues unit
- Created by
- Liz Barraclough
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