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The three basic elements of costs are direct materials, direct labor, and overhead. Direct materials refer to the supplies used in production, direct labor refers to the cost of labor directly involved in production, and overhead encompasses all other production costs not directly tied to materials or labor.
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What two elements may be thought of as a pool of costs?
Labor and materials may be thought of as a pool of costs. Labor costs represent the expenses associated with the workforce, while materials costs refer to the expenses related to the raw materials or components needed for production.
Explain why operating leverage decrease as a company increase sales and shifts away from the BEP?
As sales increase, a company's fixed costs remain the same, causing the contribution margin ratio to improve and operating leverage to decrease. This is because a higher proportion of each additional sales dollar goes toward covering fixed costs rather than variable costs. Operating leverage is highest at the breakeven point where fixed costs are fully covered.
Explain why a lithium cadmium battery is more expensive than a zinc carbon battery?
Zinc and carbon are widely available and relatively cheap. Cadmium is a toxic metal and waste streams are expensive to treat. Lithium is very reactive and more expensive to extract. So raw material costs/handling costs are higher for Lithium Cadmium
Costs can be classified by function?
Yes, costs can be classified by function into various categories such as production, marketing, research and development, and administrative costs. This classification helps in analyzing and managing expenses effectively by assigning costs to specific activities within a business.
Why can't a star fuse chemical elements beyond iron?
It sure can - and some stars do, to a minor degree. However, it can no longer gain energy from this fusion - it costs energy to create heavier elements. --- To fuse Iron, you would need a huge amount of heat and pressure, higher than what can be provided by even the massive stars is existence. The upper limit of a stars mass puts this limit on what materials it can fuse. Elements heavier than Iron are created during a supernova explosion, the death of a massive star.
