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Bus 254 > Ch 1 & 2 > Flashcards

Ch 1 & 2 Flashcards

1
Q

A field of accounting that provides economic and financial information for managers and other internal users

A

Managerial accounting

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2
Q

What type of accounting applies to all types of businesses?

A

Managerial accounting

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3
Q

What type of accounting applies to all forms of businesses

A

Manager accounting

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4
Q

True or false managerial accounting is more responsible for strategic cost management

A

True

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5
Q

Financial accounting focusses on the past. What does manager accounting focus on?

A

The future, and the present

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6
Q

True or false primary users of managerial accounting information are external users

A

False

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7
Q

Management activities and responsibilities can be classified into what three broad functions

A

Planning, controlling directing

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8
Q

What broad section of managerial accounting is this? Future oriented. Establishing objectives such as, maximizing short term, profit and market share, committing to environmental protection, contributing to social programs. The key objective is to add value to the business.

A

Planning

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9
Q

What broad function of managerial is this? Coordinate diverse activities and human resources. Implement planned objectives. Provide incentives to motivate employees. Higher and training employees, including executives, managers, and supervisors.

A

Directing

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10
Q

What broad function of managerial accounting is this? Keep activities on track. Determine whether goals are met. Decide on the changes. Needed to get back on track. Typically use a formal system of evaluation.

A

Controlling

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11
Q

True or false? Good ethics equals good business.

A

True

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12
Q

What does IMA stand for?

A

Institute of management accountants

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13
Q

Confidence, confidentiality, integrity, credibility

A

IMA members have a responsibility to comply with

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14
Q

What does CPA stand for?

A

Chartered, professional accountants of Canada

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15
Q

What accounting group promotes high standards of ethics in accounting profession, including managerial accounting

A

CPA Canada

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16
Q

Considers not only profitability, but also the companies efforts to employee sustainable business practises regarding its employees and the environment

A

Corporate social responsibility

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17
Q

What is corporate social responsibility often referred to as

A

The triple bottom line

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18
Q

Why is corporate social responsibility often referred to as the triple bottom line

A

Because it evaluates a companies performance, with regard to people, planet, profits

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19
Q

Anything from which we want to accumulate costs

A

Cost object

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20
Q

A hamburger made by a restaurant, providing a haircut, preparing a tax return for a client, building a house

A

An example of a cost object

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21
Q

Costs incurred only because the company manufactures their cost object

A

Product costs

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22
Q

Costs incurred because the company is in business

A

Period costs

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23
Q

What materials are basic materials and parts used in manufacturing

A

Raw materials

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24
Q

Raw materials that can be physically, directly, and easily associated with the finish product are called

A

Direct materials

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25
Q

Flower in the baking of bread, syrup in the bottling of soft drinks, steel used in the making automobiles

A

Examples of direct materials

26
Q

Work completed by employees that can be physically directly and easily associated with converting materials into finished goods is called what

A

Direct labour

27
Q

Legal staff at a law firm, mechanics at a vehicle, service department, type setters at a newspaper

A

Examples of direct labour

28
Q

Raw materials that cannot be easily associated with the cost object are called what

A

Indirect materials

29
Q

True or false indirect materials are considered part of of manufacturing overhead

A

True

30
Q

Lubricants, cleaning supplies, polishing compounds

A

Examples of indirect materials that may not physically become a part of the finish product

31
Q

Work completed by employees that has no direct physical association with the finished product, or for which it is impractical to trace to the goods produced

A

Indirect labour

32
Q

Wages of maintenance, workers, janitors, and factory security guards. Supervisors.

A

Examples of indirect labour

33
Q

Sum of all direct materials and direct labour costs

A

Prime. Cost

34
Q

True or false prime costs are all indirect manufacturing costs

A

False prime costs are all direct manufacturing cost

35
Q

The cost of converting raw materials into a final product

A

Conversion costs

36
Q

Sum of direct labor, and manufacturing overhead costs

A

Conversion costs

37
Q

True, or false, direct labour is a component of both prime and conversion costs

A

True

38
Q

Consists of the direct material, cost, direct, labour cost, and manufacturing overhead cost.

A

Product costs

39
Q

This type of cost is recorded as inventory when incurred. It becomes an expense to the business when the finish good is sold

A

Product cost

40
Q

Matched with revenue, earned within a specific time. And charged to expense as incurred. Non-manufacturing costs. Deducted from revenues period incurred. Non-manufacturing costs. Deducted from revenues and incurred to determine that income. Include all, selling and marketing, expenses, general and administrative expenses.

A

period costs

41
Q

The study of how specific costs respond to changes in the level of business activity. As activity levels change, some cost to change, and others will remain unchanged. Applies to all type of businesses and entities. Helps management to plan operations and make decisions. Cost behaviour analysis begins by identifying and measuring key business activities.

A

Cost behaviour analysis

42
Q

What may be expressed in terms of, number of units, produced, sales, dollars, kilometres driven, room, occupancy, dance classes taught

A

Activity levels

43
Q

What needs to happen for an activity level to be useful?

A

Changes in the level of volume of activity should be correlated with changes in cost

44
Q

The activity level selected is called

A

The activity or volume index

45
Q

What identifies the activity that causes changes in the behaviour of costs. Allows costs to be classified according to their response to changes in activities as variable cost fixed cost and mix cost.

A

The activity or volume index

46
Q

Cost very in total directly and proportionally with changes in the activity level

A

Variable costs

47
Q

Direct material and direct labour for manufacturer, sales commissions, for merchandiser, gasoline and airlines, and trucking companies

A

Examples of variable costs

48
Q

Costs that remain the same in total within the relevant range, regardless of changes in the activity level

A

Fixed costs

49
Q

Property, taxes, insurance, rent, depreciation on buildings and equipment

A

Examples of fixed costs

50
Q

Cost the very in total directly and proportionally with the changes in activity level. These costs remain the same per unit unit at energy level of activity.

A

Variable costs

51
Q

Costs that remain the same in total within the relevant range, regardless of changes in the activity level. Fix costs per unit, very inversely with activity in other words as volume increases, unit cost decrease, and vice versa.

A

Fixed costs

52
Q

Throughout the range of possible levels of activity, a straight line relationship usually does not exist for either variable cost or fixed cost

A

Use the relevant range

53
Q

The relationship between variable costs and changes and activity level is often

A

Curve linear

54
Q

For fixed costs, the relationship is what type of linear

A

Non-linear

55
Q

Defined as the range of activity over which accompany expects to operate during a year. Within this range, a straight line relationship usually exists for both variable and fixed costs.

A

Relevant range

56
Q

Costs that have both a variable and a fixed cost component. Sometimes called semi variable cost.

A

Mixed cost

57
Q

What type of cost changes in total but not proportionally with the changes in activity level

A

Mixed cost

58
Q

Mixed costs must be classified into their fixed and variable elements. Which approach is used to separate the costs.

A

The high low method

59
Q

What method uses the total costs incurred at both high and low levels of activity. The difference in costs between the high and low levels, represent and variable cost, since only a variable cost change as activity levels change.

A

The high low method

60
Q

Determine variable cost per unit using the following formula. Change in total costs at high versus low activity level divided by high minus low activity level equals variable cost per unit.

A

Step one of the high low method

61
Q

Determine the fixed costs by subtracting the total variable cost at either the high or the low activity level from the total cost at that level

A

Step two of the high low method

Bus 254 (3 decks)

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