Cost Classification

Managerial accounting involves a lot of terms that are not used in financial accounting. Understanding and being familiar with these different terms and their uses will allow you to be a better decision maker. When you hear these terms used in the workplace, you will be better able to contribute to the discussions surrounding costs.

Respond to the following in a minimum of 175 words: 

  • In the context of your day-to-day business experience, make a list of the costs (at least 8 costs) you are responsible for or that affect your management decisions on a regular basis. 
  • Classify those costs as fixed or variable, manufacturing or nonmanufacturing, product or period. 
  • Provide an example of a managerial decision that was affected by some of the costs you listed. What was the effect?
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