A segmentโs contribution margin less its traceable fixed costs. It represents the margin available after a segment has covered all of its own traceable costs.
Segment margin
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15
A costing method that includes all manufacturing costsโdirect materials, direct labor, and both variable and fixed manufacturing overheadโin unit product costs.
Absorption costing
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15
A costing method that includes only variable manufacturing costsโdirect materials, direct labor, and variable manufacturing overheadโin unit product costs.
Variable costing
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trap
No points!
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gold
Win 50 points!
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fairy
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5
10
15
20
25
lifesaver
Give 20 points!
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15
A fixed cost that is incurred because of the existence of a particular business segment and that would be eliminated if the segment were eliminated.
Traceable fixed cost
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baam
Lose 15 points!
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gold
Win 50 points!
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rocket
Go to first place!
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lifesaver
Give 10 points!
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15
Any part or activity of an organization about which managers seek cost, revenue, or profit data.
Segment
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15
A fixed cost that supports more than one business segment, but is not traceable in whole or in part to any one of the business segments.