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30 Cards in this Set
- Front
- Back
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What are the aspects of managerial accounting?
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•Internal
•No regulatory agencies •Emphasis on the Future •Subjective •Broad, multi-disciplinary |
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What are the aspects of financial accounting?
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•External
•GAAP •Historical Oriented •Objective •More self-contained |
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Who uses Managerial Information and what is it?
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Information about value chain activities and customer sacrifice
Managers and other people within the company use it to make managerial decisions. It is needed for the planning, controlling, and decision making process because base their objectives and goals off of the accounting. |
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is the detailed formulation of action to achieve a particular end.
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Planning
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is the monitoring of a plan’s implementation.
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Controlling
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is choosing among competing alternatives.
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Decision making
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accountant that has certificate that meets the specific needs of management accountants.
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CMA
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set of activities required to assign, develop, produce, market, and deliver products and services to customers.
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Value Chain
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having someone on management who understands all facets of business will be better when it comes to business decisions.
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Cross-functional perspective
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a company who that increases customer value may create a sustainable competitive advantage
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Strategic positioning
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the cash or cash-equivalent value sacrificed for goods and services that are expected to bring a current or future benefit to the organization
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Cost
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relies on physical observation to assign cost. It is more accurate than allocation because it is based on cause and effect relationships.
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Direct tracing
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relies on assumed relationships and convenience to assign costs
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Allocation costing
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anything for which a cost is measured or assigned
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Cost Object
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COGM
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DL+DM+MOH
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COGS
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(COGM/Goods produced)*goods sold
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Job order costing
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•Collects cost by job
•Produce heterogeneous products where each unit or batch has a different total cost •Examples: construction, custom cabinetry, dentistry, medical services, and automotive repair |
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Process costing
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•Homogenous products
•Cost of one batch or unit is the same as another. •Examples: paint manufacturing, check clearing, toy manufacturing. |
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PDOR
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Estimated annual OH/Estimated annual Activity level
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Applied OH
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PDOR*actual actrivity level
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Weighted Average Method:
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Equivalent units of production are the complete units that could have been produced give the total amount of manufacturing effort expended during the period.
The number of physical units is multiplied by the percentage of completion to compute unit costs |
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Activity Based Costing
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This type of costing is needed because functional based costing don’t account for non-unit based overhead properly. Having a product cost with only unit based costing distorts the cost.
Unit-level: volume based Non-unit level: batch, facility, or product |
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When to use ABC?
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•Compute processes
•Variety of products •Different volumes |
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Example of Prevention Activities:
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Training programs
Quality design/engineering Supplier certification Field testing |
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Example of Appraisal Activities:
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Scrap
Rework Downtime Design changes |
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Example of Internal Failure Activities:
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Inspecting materials
Product/process acceptance Production supervision |
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Example of External Failure Activities:
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Legal costs
Warranty work Returns Allowances for poor quality |
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Hidden cost
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cost that are not easily quantified
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create the products or services that the firm is in business to manufacture and sell.
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Producing department
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support the producing departments but do not create a salable product.
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Support Departments
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