A finished BUS-317 Topic 3 cost behavior impact memo example, classifying costs by their response to an added trading day and showing how each classification moves the decision. Searches like "bus 317 topic 3 assignment example", "bus317 topic 3 sample" and "bus-317 topic 3 example" land here.
What a finished BUS-317 Topic 3 cost behavior impact memo looks like
The finished memo works from the decision back to the costs. Ingredients and packaging rise with every sale and are treated as variable. Rent and the equipment lease do not move at all when Sunday is added, and the memo says plainly that they therefore play no part in the choice. Staffing is handled as a step: the existing team can absorb a quiet Sunday, but a busy one requires a shift lead, and that single hire changes the verdict. Utilities are split into a fixed base charge and a usage portion. The memo then shows why the current average cost per item, which spreads rent across existing sales, would badly overstate the cost of Sunday trade if anyone used it to decide.
How a BUS-317 Topic 3 example is structured
The memo moves from the proposal to the costs and back to the proposal. Its first paragraph states the choice, the extra day it adds and the sales range the manager expects that day to bring. A cost inventory follows, listing every expense the cafe carries and assigning each a behavior: variable, fixed, stepped or mixed. Each assignment carries a line of justification tied to the Sunday decision in place of a textbook definition. The next passage builds the added revenue and added cost at the low and high ends of the expected range, which is where the step in staffing appears. A short passage explains why the existing cost per item misleads for this purpose. The final paragraph gives the decision at each end of the range and names the sales level at which the shift lead becomes necessary.
Each cost tied to the choice
Every expense is classified by how it responds to opening an extra day, with a line saying why that classification matters for this decision.
Fixed costs set aside explicitly
Rent and the equipment lease stay identical whether or not the cafe trades on Sunday, so the memo removes them from the comparison in plain words.
The staffing step located
A busy Sunday needs a shift lead that a quiet one does not, and the memo finds the sales level where that cost arrives.
Mixed costs separated into parts
Utilities carry a base charge paid regardless and a usage portion that rises with trading hours, and only the second enters the decision.
Average cost per item rejected
The existing figure spreads rent across current sales, so applying it to Sunday trade would count costs the new day does not create.
Where marks go in BUS-317 Topic 3
Classification offered for its own sake loses the most here, because a neat table of fixed and variable costs with no bearing on the decision is preparer's work, which BUS-317 leaves to the accounting courses. The average cost trap follows close behind: dividing total cost by current sales and applying that figure to new volume charges the new day with rent it does not cause. Treating staffing as smoothly variable misses the step, and the step is frequently what decides the matter. Mixed costs placed wholly in one category distort the comparison in whichever direction the writer chose. Ignoring the range of expected sales produces a single verdict that may hold at the low end and fail at the high one. A memo without the threshold for the extra hire leaves the manager missing the one figure worth watching.
Get a BUS-317 Topic 3 example written to your instructions
Send the BUS-317 Topic 3 instructions and the rubric attached in your classroom, plus whatever case or cost data your section provides. We write a custom example to that brief, with every cost classified by its response to the decision, fixed costs set aside, the staffing step found and average cost per item rejected, in 24 to 48 hours. The first one is free.
BUS-317 Topic 3 questions, answered
Why is average cost per item misleading for a volume decision?
Because it spreads costs that do not change across the items currently sold. If rent is divided into today's sales, each item appears to carry a share of it, and adding volume seems to add rent as well. In fact the rent is the same either way. Only costs that actually respond to the change belong in the comparison, and average cost conceals which ones those are.
What is a step cost?
One that holds level over a band of activity and then rises by a fixed amount once that band is exceeded. A supervisor, a delivery vehicle or an extra machine behaves this way. Step costs matter in decision papers because they often sit just beyond the volume being considered, so a proposal that looks profitable at one level can turn unprofitable a little above it.
Does a fixed cost stay fixed forever?
Only within a relevant range of activity and a limited period. Rent is fixed until the lease ends or the business needs more space, and salaries are fixed until headcount changes. The memo states the range its classifications assume, since a decision that pushes activity beyond that range turns some fixed costs into changing ones and alters the comparison.