CH14: Managerial Acct Flashcards
Mangerial accting
provides financial and non financial info to a businessess managers
The purpose of managerial acctg
-determining costs of an orgs products/services
-planning for future activites
-comparing actual results to planned results
planning vs controlling
-process of setting foals and making plans to achieve them
-process of monitoring/evaluating an businesses activities and employees
what is the cost object
product to which costs are assigned
what are direct costs and what does it consist of
costs that can be traced to a cost object (consists of direct mats and labor)
direct materials & labor
-material directly needed for items
-labor and salary of ppl directly involved int he production of the product
indirect costs
costs that cant be traced to a cost object (consiststs of indirect mats, indirect labor, and factory overhead)
what is factory overhead
manufacturing costs that are not traced to a cosr object (anything to do with factory)
what does factory overhead include
-indirect mats
-indirect labor
-other utilities (deprecitation, gas)
indirect materials
materials that are not used for product production ORRR that can be used for smth other than product
-ex screws, needles, ink
indirect labor
labor that cannot be traced
ex: supervisor salary
prime costs
direct material + direct labor
conversion costs
Direct labor + factory overhead
what does product costs consist of
-direct mats
-direct labor
-factory overhead
period costs
-selling expenses
-general expenses
selling expense examples
-advertising
-sales commissions
-etc
manufacturer vs merchandiser
-purchases materials and converts it to products
-buys and sells the goods
what inventories does a manufacturing company report
-raw material
-work in process
-finished goods
what inventories does a merchandising company report
-merchandise inventory
how to find cost of goods sold for a merchaniser
beginning merchandise + merchandise purchased - ending merchandise
how to find cost of goods sold for a manufacturer
beginning finished goods + cost of goods manufactured - ending finished goods
income statement basic
sales
cost of goods sold
-inventory beginning
-cost of goods merch/manufact
-goods available
-ending inventory
cost of goods solds
gross profit
expenses
net income/loss
how to find gross profit
sales- cost of goods sold
general and administrative expenses
expenses for manager salaries, office equipment etc
selling
ex. advertising
cost of goods manufactured sheet
Direct materials
-raw mats beg
+raw mats purchases
=raw mats avail
-raw mats end
=direct mats used
Direct labor
Factory overhead
-utilities
-indirect
-etc
=total factory overhead
Total manufacturing costs
+work in. process beg
total cost of work in process
-work in process end
=cost of goods manufactured
how to find direct materials used
raw mats beginning + raw mats purchases - raw mats ending
how to find total manufacturing costs
direct mats used + direct labor + factory overhead
where does prepaid expenses go ?
assets
continous improvement (CI)
ongoign process of making changes to improve to make business more efficient
-new products
-surveys
Just -in- time (JIT)
strategy aimed to reduce waste by delerving goods/mats exactly when needed
-order kiosks
-food produced in 3 mins
Total Quality Management (TQM)
improving the quailty of business factors
-courteous employees
-clean tablees
standardized food making
people /social TBL
focus on people
-laborers
-working conditions
-fair wages
enviornment/ planet
focus on the env.
-renewables
-water consumption
financial/profit
focus on money aspect
-sales
-revenue
-net income
any depreciation is typically a
indirect cost
income + fixed costs=
contribution margin
