Financial Decision Making for Managers

Part 1

1. What is relevant range?

2. Give two examples of costs that are variable costs and two examples of fixed costs.

Part 2

1. Explain the responsibility of the accounting department.

2. What is one advantage of having 2 costs pools (one for fixed costs and one for variable costs) for each service department?

Part 3

1. How would a manager use economic theory to determine profit-maximizing price for a service or product?

2. What is the process of target costing? How is target cost calculated?