Some methods for cost analysis are the following:
- Process Costing - Assigning unit costs to items created with a process that does not stop when part of a single unit is completed
- Variable Costing - Segregating fixed costs and variable costs on a per unit basis
- Activity Based Costing (ABC) - Another alternative method of tracking costs in order to see how profitable a product or customer is. All activities are assigned a cost. A percentage of each activity used to create a product or service can then be summed for an overall cost.
A general master budget can be broken up into many smaller budgets. This helps organize the task and ensure its correctness.
Example Master Budget System
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhgWyCp1vdBAmOrcJmbTjHLThaX-NUziurKpm70nwGbcLZXJKBMZoCd76TfjGbC5cWYpmR9CtyN9gcdB7Aj2PUSOmjUkWpEMaD1VKz86x4g3x_hiTuTOWUmZxs_w8gqhiIrTZdczh3oxLi-/s400/Picture+2.png)
Example Sales Budget
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhIktpQ2y64fCLxGZNHA07cnPFchyaSGlS8Y9aTlU1FUTHlZVajV1a4m5FEq4ecAFgAjlNoTA4o97SylMOC2CoaTGUVZrelkjz_Cy9QuPndyQNmzXRzqNp14w3jNl80F14ylJqqixF1qgv8/s400/Picture+3.png)
An additional step that is often used when creating a budget is that of flexible budgets. A flexible budget is a budget based on activity ranges. Instead of creating one possible sales figure, or production figure, a few range or checkpoint numbers are chosen and a budget line is created for each of these.
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