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Cost Behavior Patterns And Concepts

Part 1

As EEC’s corporate business financial analyst, you will need to have a clear understanding of the different types of costs (variable, fixed, and mixed) that the company carries. Complete the following for this assignment:

  • Review EEC’s journal activity.
  • Define and identify its variable, fixed, and mixed costs.
  • Determine what affect a sales volume increase or decrease will have on unit fixed cost, unit variable cost, total fixed cost, and total variable cost.

Click here to view EEC’s journal activity.

Part 2

As an EEC corporate business financial analyst, you must have an expert understanding of the various costing methods. Select 1 of the following costing concepts:

  • Full costing or absorption costing
  • Variable costing
  • Target costing
  • Life cycle costing
  • Activity-based costing

Respond to the following questions on the costing concept that you selected:

  • Provide the definition of the concept.
  • Discuss how and when the concept could be used by EEC.
  • Discuss the advantages and disadvantages of the concept as it relates to EEC.
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