Several cost management terms are defined and illustrated in the chapter. A cost driver is any activity or event that causes costs to be incurred. Fixed and variable costs are defined by the behavior of total as the organization's activity level changes. Direct and indirect costs refer to the ability of the accountant to trace costs to various departments in the organizatiom. The terms controllable and uncontrollable are used to describe the extent to which a manager can influence a cost. Costs are classified into cuch functional categories as manufacturing costs, selling costs, and administrative costs. Manufacturing costs are further subdivided into direct-material, and manufacturing-overhead costs. The terms product cost and period cost refer to the timing with which costs become expenses.