An analysis and reporting of revenues earned, and the incurred costs to earn these revenues from customers is classified as ___________?
Correct answer: C. customer profitability analysis
- A. partial productivity analysis
- B. treasury cost analysis
- C. customer profitability analysis
- D. customer cost analysis
Explanation
Customer profitability analysis combines revenue from each customer with the costs required to serve that customer, revealing the resulting profitability. Customer cost analysis would focus on costs without necessarily relating them to earned revenue.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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