Cost Drivers Essay Example | Topics and Well Written Essays - 500 words

Cost Drivers - Essay ExampleFinally, cost drivers includes hours of time, procedure of employees, number of setups, number of wheel, number of enquiries, number of products produced, number of machines maintained, and number of hours of supervision.Cost behaviour normally strike to various activities as well as the consumption of resources ((Hansen et al. 2009). Such resources have be which are any fixed and do not vary readly with resource usage in the short stand or variable and varies in transmit proportion to the resource consumption. Activities usually consume resources and the costs of such(prenominal) resources often follow various behavioural patterns (Needles et al. 2010).Since, the supervisors spend an equal amount of time with each employee they supervise, the costs associated with it are fixed, and they do not vary directly with resource usage. Since the building is allocated based on unbowed footage, the costs are variable. There is a direct correlation between a mount of space employ and the rent. There is also a direct correlation between the Energy or electric top executive consumed and the number of units produced (Needles et al. 2010).In terms of labour, the costs are variable as they change in direct proportion to the number of units produced. The cost of equipment is fixed and does not vary directly to the units produced. The cost of materials varies in direct proportion to the number of units produced. There is an indirect relationship between amount of supplies and production time. The costs whence vary in direct proportion to the resource consumption ((Hansen et al.