Cost Behaviour (Cost Behavior)
Accounting glossary · Understand, connect, apply
Cost behaviour describes how a cost changes when activity, time or another driver changes. Common patterns include fixed, variable, mixed and step costs.
Example
A workshop’s materials vary with units, rent stays fixed within capacity, and an extra supervisor is needed above a staffing threshold. Each cost therefore needs a different budget model.
Remember the difference
Specify the activity driver, time period and relevant range. A pattern observed in historical data may change when contracts, technology or operating conditions change.
Browse the accounting glossary → · Follow a learning path
Published 4 November 2026. Prepared with AI assistance; examples are fictional and simplified for learning.
Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
← Return to the accounting glossary