Examples Of Cost Drivers In Globalization
Cost Drivers Factor
By on July 23, 2013 in See Also: Cost Driver Definition In, the cost driver definition is a factor that incurs cost. Use cost drivers to allocate and to activities or output. Include both indirect and direct to compute the full cost of.
Examples Of Cost Drivers
Market drivers. This is the degree to which the tastes of people around the world are similar. The more similarity, the more globalization. Cost drivers.
Because indirect, such as variable, are not directly traceable to activities, allocate them according to a driver rate to apply these to activities. Based on the activity of the cost driver, the cost driver rate is the rate indirect applied to production activities. Download the free Know Your Economics guide to easily manage the factors incurring costs in your company. Choosing Cost Drivers An indirect or may have several possible drivers. Traditional methods allocate indirect to production activities based on of output. Conversely, allocates indirect to particular production activities related to that cost. When deciding which driver to use in terms of allocating indirect cost, consider the cause-and-effect relation between the and the.
In addition, consider whether or not the cost activity is easily measurable. It is also necessary to consider the cost behavior of the relevant cost. The relevant cost refers to the cost’s response to the activity of the.