Controllable and non controllable costs, Cost Accounting

Assignment Help:

Controllable and Non Controllable Costs

Controllable costs can be influenced on the level of authority at that they are being analyzed when non-controllable costs cannot.

A. Controllable cost - Refers to the cost that can be influenced via the actions of a person in whom authority for that control is vested, as like an example control of labour cost will be influenced via the method of remuneration and the degree at management control that is exercised via a specific managers.

B. Non controllable cost - is cost that cannot be influenced via a person in whom authority for that control is vested as like an example: if the trade union demands a rise in wages the increment is non controllable cost. Likewise, the depreciation of a building is a non-controllable cost to a manager like he does not contain authority over depreciation!

In decision making, merely controllable costs are considered since they can be changed via the decision maker. There is little or nothing such the decision maker can do about the non-controllable costs hence they are irrelevant in decision making. But, the facilities given through the nun-controllable costs should be efficiently utilized.


Related Discussions:- Controllable and non controllable costs

Methods of work in progress, Methods of Work in Progress The two main ...

Methods of Work in Progress The two main methods used for purposes of valuing the opening work in progress: 1. Weighted Average Method 2. FIFO or First In First out Meth

Assessment item 2, rocess costing Prepare a spreadsheet to solve the follow...

rocess costing Prepare a spreadsheet to solve the following process costing problem. Review the four process costing videos provided in Interact Resources. Note that in the situati

Calculate the predetermined overhead rate, Bubba's Crawfish Processing Comp...

Bubba's Crawfish Processing Company uses a traditional overhead allocation based on direct labor hours. For the current year, overhead is estimated at $1,150,000, and direct labor

Share capital of a company, A company has an authorized share capital of 25...

A company has an authorized share capital of 250 million divided into 1,500,000 ordinary shares of sh.100 each and 1,000,000 preference shares of sh.100 each. 1,000,000 ordinary sh

Material, annual usage rs 160000@ 40 per unit, cost of placing and receivin...

annual usage rs 160000@ 40 per unit, cost of placing and receiving one order rs 200:annual carrying cost ; 25% of inventory value

Costing term, Match each of the six following terms with the phrase that mo...

Match each of the six following terms with the phrase that most closely describes it. Each answer may be used only once. _____ 1. Direct costs _____ 2. Fixed costs _____ 3

Break Even point, #question.ABC Corportaion produces and sell two products....

#question.ABC Corportaion produces and sell two products. In the most recent month, Product 123 had sales of $33,000 and variable expenses of $15,840. Product 245 had sales of $42,

Calculate the atm fee should the bank charge - marginal cost, A bank in a m...

A bank in a medium-sized midwestern city, Firm X, currently charges $1 per transaction at its ATMs.  To determine whether to raise price, the bank managers experimented with a n

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd