Conversion cost = Direct labor + Manufacturing overhead

Variable Cost Per Unit = high – low in total cost / high – low activity level
Variable cost = Change in cost  Change in activity

Total Variable Cost = variable cost per unit x units no.

Total Fixed Cost = high total cost – (variable cost per unit x units no.) >> HIGH LEVEL

Total cost = total variable cost + total fixed cost

Contribution margin = selling price/unit – variable manufacturing costs/unit
Contribution margin= sales - variable costs
Contribution margin ratio= contribution margin / sales
Break even in sales dollar = Total fixed costs/ Contribution margin ratio
Gross margin= selling price/unit – manufacturing costs per unit
Traditional Costing & Activity Based Costing (ABC)

ESTIMAED ACTUAL
Estimated MOH / Activity BASED COSTING
https://www.youtube.com/watch?v=M-uGibLcQ-g

Traditional costing = total OH / Total allocation based = $ per

hour
ABC = TOTAL OH / TOTAL ACTIVICY BASED
TOTAL OH activity / TOTAL ACTIVICY BASED