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Controllable costs are expenses that a business has the power to change. Many business costs are controllable to some extent, such as payroll and materials. Relative costs are expenses that change depending on where the company does business, such as the costs of transporting goods. Although controllable cost and relative costs may seem like different concepts, a cost can be both controllable and relative. It is a simple task to decide if an expense is controllable or uncontrollable and if it is relative.
Controllable expenses are those that can be directly managed month to month by the action of the owner/manager. Of course all costs are theoretically controllable but generally
