Teamwork in Action

TEAMWORK IN ACTION retail blood that sells music CDs 1. In retail store that sell music CDs, the single measure beat out reflects the overall level of activity is Number of CDs interchange. In value to changes in the measure of CDs sell, a variable star be is a cost that varies, in total, in direct coincidence while a dogged cost remains unchanged, in total, regardless of any change. -Examples of hardened and variable costs in respect to small changes in the measure of selling CDs greet Cost behavior Variable Fixed The cost of advertising new store XNumber of CDs supplied X The cost of renting space for store X The electrical cost in store X The direct labor cost X The cost of delivering CDs X Variable Cost Number of CDs supplied Cost of CD Total variable Cost CDs 1 35. 000 35. 000 50 35. 000 1. 750. 000 100 35. 000 3. 500. 000 Fixed Cost Monthly Labor cost Number of CDs sold Average cost per CD 5. 000. 000 20 250. 000 5. 000. 000 70 71. 428,6 5. 000. 000 150 33. 3 33,3 2. Relationship between the number of CDs sold and others Cost Behavior of the cost In Total Per Unit Fixed cost Total fixed cost is not affected by changed in the number of CDs sold. Fixed cost per unit decreases as the number of CDs sold rises and increases as this number falls. Variable cost Total variable cost increases and decreases in proportion to changes in the number of CDs sold. Variable cost per unit remains constant. Total cost Increases and decreases in proportion to changes in the number of CDs sold Average total cost per unit Increases and decreases in proportion to changes in the number of CDs sold