This chapter investigates the impact of changes in the volume of activity undertaken by a business on costs and profits. To examine these changes and the financial implications, a technique known as marginal costing (also known as variable costing) is used. Marginal costing principles are also used in cost-volume-profit (CVP) analysis and break-even analysis, which we shall be looking at in Chapter 15.
KeywordsMarginal Cost Variable Cost Fixed Cost Selling Price Management Account
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