ADMS 2510 Chapter Notes - Chapter 2: Avon Products, Fixed Cost, Chief Financial Officer

• School: York University
• Department: Administrative Studies
• Course: ADMS 2510
• Professor: Alison Beavis

Document Summary

Exercise 2-5 (30 minutes: per unit amounts: Exercise 2-5 continued: factors that could cause variable costs per unit to change when activity levels fall outside the relevant range, direct material costs per unit could decrease if quantity discounts are received. Note: requirement three may be a stretch for many students given that the factors affecting cost behaviour outside the relevant range are not discussed in detail in chapter 2. Accordingly, providing some hints to generate ideas may be warranted. Rent on the space occupied by the registration desk Note: the costs of the rent on the space occupied by the registration desk and the wages of registration desk personnel are neither differential costs, opportunity costs, nor sunk costs. These are costs that do not differ between the alternatives and are therefore irrelevant in the decision, but they are not sunk costs since they occur in the future.