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Mangerial Accounting 201B > ch 14 powerpoint > Flashcards

ch 14 powerpoint Flashcards

1
Q

Managerial accounting

A

provides financial and
nonfinancial information for managers of an
organization and other decision makers.

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2
Q

M.A. in planning

A

Develop new products?
* Expand into new markets?
* Build a new factory?

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3
Q

m.a. in control

A

Are costs too high?
* Are services profitable?
* Are customers satisfied?

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4
Q

Diff between managerial and financial accounting

A
  1. users and decision makers
  2. purpose of information
  3. flexibility of reporting
    etc…
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5
Q

What is an internal control system?

A

policies and procedures used to:

  1. Ensure reliable accounting
  2. Protect assets
  3. Uphold company policies
  4. Promote efficient operations

The Institute of Management Accountants has issued a code of ethics to help accountants involved in solving ethical dilemmas.

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6
Q

managerial accountants must

A

Have knowledge of Financial accounting
* Have knowledge of Managerial accounting
* Have strong communication skills
* Have knowledge of how businesses work
* Be a team player

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7
Q

careers in m.a.

A

top level
senior management
etc..

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8
Q

Following are aspects of accounting information.
Classify each as pertaining more to financial accounting or to managerial accounting.

A
  1. Primary users are external
  2. Includes more nonmonetary information
  3. Focuses more on the future
  4. Uses many estimates and projection
  5. Controlled by GAAP
  6. Used in managers’ planning decisions
  7. Focuses on the whole organization
  8. Not constrained by GAAP
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9
Q

What is cost behavior?

A

refers to how a cost
will react to changes in the level of
business activity.

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10
Q

What is total fixed costs?

A

do not change
when activity changes

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11
Q

What is total variable costs?

A

change in proportion to activity changes

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12
Q

2 types of cost classifications

A

direct vs indirect

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13
Q

What is direct costs?

A

Costs traceable to a single cost object.
* Examples: material and labor cost for a
product

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14
Q

What is indirect costs?

A

Costs that cannot be traced to a single cost
object.
* Example: maintenance expenditure benefiting
two or more departments

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15
Q

What is product cost?

A

-Direct Labor
* Direct Material
* Manufacturing Overhead

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16
Q

What are period costs?

A

-expenses not attached to the product

  1. Selling costs are incurred to obtain orders and
    to deliver finished goods to customers.
  2. Administrative costs are non-manufacturing
    costs of staff support and administrative
    functions.
17
Q

How do period and product cost affect financial statements?

A
  1. period costs(expenses) affect income statement (operating expenses)
  2. product costs(inventory) affect

-income statement (costs of goods sold) bc (invent. sold)
&
-balance sheet (inventory) bc of (invent. NOT sold)

18
Q

Exs of variable or fixed.

A

exs of direct or indirect
exs of product or period
The cost concepts described are generally
applicable to service organizations

—-For example, the cost of beverages for
passengers of Southwest Airlines is a variable
cost based on number of passengers

19
Q

Direct material or Direct labor or product costs or period costs

A
  1. Plastic board used to mount the chip
  2. Advertising costs
  3. Factory maintenance workers’ salaries
  4. Real estate taxes paid on the sales office
  5. Real estate taxes paid on the factory
  6. Factory supervisor salary
  7. Depreciation on factory equipment
  8. Assembly worker hourly pay to make chips
20
Q

Direct materials

A

costs are the expenditures for
direct materials that are separately and readily
traced through the manufacturing process to
finished goods

Example:
Steel used in the frame of a mountain bike.

21
Q

Direct labor

A

costs are the wages and salaries for
direct labor that are separately and readily
traced through the manufacturing process to
finished goods

Example:
Wages paid to a mountain bike assembly
worker.

22
Q

Factory overhead

A

consists of all manufacturing
costs that are not direct materials or direct
labor and the costs cannot be separately or
readily traced to finished goods.

Examples:
* Indirect labor – maintenance.
* Indirect material – cleaning supplies.
* Factory utility costs.
* Supervisory costs

23
Q

Manufacturing costs

A
  1. Prime Cost:
    – Direct Material
    – Direct Labor
  2. Conversion Cost
    – Direct Labor
    – Manufacturing Overhead
24
Q

Reporting Manufacturing Activities

A
  1. Merchandisers . . .
    – Buy finished goods.
    – Sell finished goods.
  2. Manufacturers . . .
    – Buy raw materials.
    – Produce and sell finished goods.
25
Q

Manufacturer’s Balance Sheet

A

Raw Materials
– Materials waiting to be processed.
– Can be direct or indirect.
* Work in Process
– Partially complete products.
– Material to which some labor and/or overhead have
been added.
* Finished Goods
– Completed products for sale

26
Q

Compute cost of goods sold for a manufacturer
and for a merchandiser. (PIC and exs)

A
27
Q

Trends in managerial accounting

A
  • Customer Orientation
  • E-Commerce
  • Lean Practices
  • Global Economy
  • Service Economy
  • Value Chain
28
Q

Constant Focus on Higher Standards

A
  • Quality improvement applied to its business
    activities.
  • Employees encouraged to try new methods
    to improve quality.
  • Seek and uncover waste.
  • Company emphasizes value of quality
    through quality awards.
29
Q

Just-In-Time (JIT) Manufacturing

A
  • Receive customer orders
  • Schedule Production
  • Receive materials just-in-time for
    production
  • Complete parts just-in-time for assembly
    into products
  • Complete products just-in-time to ship to
    customers
30
Q

Value Chain

A

The value chain refers to the series of Activities
that add value to a company’s products or
services. Companies can use lean practices to
increase efficiency and profits.
Acquire raw materials  Banking  Sales 
Service

31
Q

Lean Model Practices Impact for
Managerial Accounting

A
  • Adopting the lean practices means that all
    systems and procedures must be realigned.
  • Managerial accounting has an important role
    in providing accurate cost and performance
    information.
32
Q

Corporate Social Responsibility

A
  • Corporations must consider demands of
    employees, suppliers, and society.
  • Corporate social responsibility (CSR) goes
    beyond law.
  • Triple bottom line focuses on financial, social
    and environmental measures.
  • Adopting a triple bottom line impacts how
    business report

Mangerial Accounting 201B (1 decks)

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