Lesson Plan

• Describe why accurate cost information is essential for managerial decision‑making.
• Explain the main types of cost information (fixed, variable, semi‑variable, direct, indirect) and their typical uses.
• Apply standard costing, activity‑based costing and marginal costing to price a product and calculate contribution margin.
• Analyse cost data to identify relevant, sunk and opportunity costs when evaluating alternatives.

• Projector and screen
• Whiteboard and markers
• Printed handout of cost‑type table
• Calculator or spreadsheet software (Excel/Google Sheets)
• Worksheet with cost‑calculation exercises
• Case‑study cards illustrating inaccurate cost data

Begin with a brief news clip about a company that lost market share due to poor pricing. Ask students what information might have been missing. Review prior knowledge of fixed and variable costs. State that by the end of the lesson they will be able to produce and use accurate cost data to make pricing, budgeting and strategic decisions.

1. Do‑now (5'): Quick quiz on identifying cost types from examples.
2. Mini‑lecture (10'): Explain why accuracy matters, show the cost‑type table and discuss typical uses.
3. Group activity (15'): Analyse a case where inaccurate cost data caused pricing errors; identify the mistakes.
4. Demonstration (10'): Use a spreadsheet to compare standard costing and activity‑based costing for a product.
5. Guided practice (15'): Students calculate contribution margin, break‑even quantity and apply the five‑step decision‑making process to a new scenario.
6. Check for understanding (5'): Exit ticket – one sentence summarising why accurate cost information is vital.

Recap the link between accurate cost data and effective pricing, budgeting and strategic choices. Collect exit tickets and clarify any lingering questions. For homework, students complete a worksheet that requires them to select relevant costs and compute the profit impact of a make‑or‑buy decision.