Fixed cost coverage calculation
The fixed cost coverage calculation (or multi-level contribution margin calculation ) is an essential component and a method of business cost accounting . In contrast to the single-level contribution margin calculation ( direct costing ), in which the contribution margin is compared directly to the total of the fixed costs, the fixed cost coverage calculation is divided into several levels.
In the first stage, the fixed cost coverage calculation - analogous to direct costing - basically assumes a separation into variable costs and fixed costs . In the various other levels, the fixed costs are further divided or "graded" according to the degree of their attributability to a specific product:
- Fixed product costs
Costs caused by development, manufacturing and distribution. They can only be assigned to the total number of products within a period, not to each individual (e.g. salaries for machine operators).
- Product group fixed costs
Costs can only be assigned to one group of products, e.g. B. Costs for special machines that are only incurred for one product group.
- Fixed cost center costs
Occur at a specific cost center and are therefore not directly offset against the products (e.g. salaries that are not incurred due to production).
- Area fixed costs
They are to be assigned to a cost area as a group of cost centers (e.g. fixed costs of the administrative area).
- Company fixed costs
They are the so-called “residual fixed costs” and therefore cannot be assigned to any other level (e.g. management costs due to the goods produced).
The attribution to a specific product is based on the causal allocation of costs, i.e. the individual cost character of the fixed costs. Thus, a “coding” of costs (e.g. 50% of 100 euros of company fixed costs are allocated to area A, 50% to area B, because they each have the same number of employees ) is prohibited in the calculation of fixed cost coverage.
As soon as you code a cost element - whatever - because you can no longer assign it hierarchically “lower”, you violate the causation-based assignment in the sense of the fixed cost coverage calculation.
Expressed in contribution margins , the fixed cost coverage calculation looks like this:
|Area A||Area B|
|Costing object||Product a1||Product a2||Product b1||Product b2||Product c|
|./. variable costs||100||1000||250||50||80|
|= Contribution margin I.||900||4000||500||150||420|
|./. Fixed product costs||100||800||100||40||20th|
|= Contribution margin II||800||3200||400||110||400|
|./. Product group fixed costs||1900||210||110|
|= Contribution margin III||2100||300||290|
|./. Area fixed costs||1100||290|
|= Contribution margin IV||1000||300|
|./. Company fixed costs||800|
|= Contribution margin V / operating result||500|
- The fixed cost coverage calculation is used accordingly in the customer contribution margin calculation .
- ↑ Barth, H .: Controlling - An Instrument for Profit Management , p. 31.