marginal costing

"Determination of incremental cost and hence trade-off value of additional material for performance or safety, additional labor for faster progress, and so on. It is used where unit costs are not appropriate because some costs such as rental or overheads are already in place. Some adjustment must be made for reduction in productivity due to work transfer or for divided responsibility, for example, following introduction of a second shift on the same activity.

SOURCE: apm.com"