chapter 1 Flashcards
4 accounting objectives
control, planning, documentation, monitoring
3 accounting system things
financial, capital budgeting, management accounting
what is capital budgeting
long term decisions, process of investment planning
financial accounting includes
balance sheet, financial statements, cash flow statement
management accounting and cost accounting
cost accounting gives information managers need
are there rules for management accounting
not really
accounting object for management accounting and financial accounting
management: disaggregated accounts for smaller parts of the company, vs aggregated accounts for segments and whole company
time span and frequency of management accounting
more often, daily, weekly monthly reports
focus (time wise)management vs financial ?
management past and future
financial past oriented
cost accounting vs. capital budgeting forecast
cost accounting up to one year for operational decisions, capital long term effects of decisions, time value of money important
cost
revenues
valuated and what?
monetary valuated consumption of resources,(not buying but using) valuated production of goods
cash outflows not affecting shareholders equity ( 2 things)
repayment of a loan divident payment
expenses cash/equity
cash outlfow affecting equity wealth
imputed costs (2)
opportunity costs imputered interest cost
cash outlows affecting shareholders equity can be called
expenses
can cash outlows affecting shareholders equity be called expenses?
yes
Expenses not related to business objectives • Expenses related to other periods • Extraordinary expenses are what?
non-operating expenses, and cash outlfow affecting shareholders equity
are operating expenses = basic costs (material, salary)?
yes
are imputed costs expenses?
no, they are costs that are not operating expenses
destruction of a plant , expense, cost , cash outflow?
non-operating expense, cash outflow affecting shareholders equity
sale of equipment below book value ? expense, cost , cash outflow?
non-operating expense, cash outflow affecting shareholders equity
divident payment expense, cost , cash outflow?
cash outflow not influecning shareholders equity
what decreases shareholders equity
decrease of assets
average unit costs — (more/less)with total output quantity
decreases (economies of scale)
inventoriable costs
costs assigned to a product unit (steel for car)
period costs
costs that cant be capitalized (cant be an asset in balance sheet, general admin costs salary)
Period costs are all costs not included in product costs. … Therefore, period costs are listed as an expense in the accounting period in which they occurred. Other examples of period costs include marketing expenses, rent (not directly tied to a production facility), office depreciation, and indirect labor.
sunk costs
costs caused by past cant be changed
levelized product cost
how expensive a product is over a lifetime
cost type accounting question
labor material, depreciation -> how much? (which costs?)
cost center accounting question
where is company, departemnt country, where have costs been incurred
product and service costing
what type/series/what was sold ?
absorption costing explain 5 steps of cost type, cost center, prodcut and service and profit and loss
- indirect and direct in cost type
- indirect in cost center
- indirect and direct in product and service
- profit and loss
- reveneue into profit and loss
variable costin explain 4 steps
- cost type accounting fixed indirect, variable indirect, direct cost
- cost center fixed indirect, variable indirect,
- product service, variable indirect, direct costs
- profit and loss take revenues minus variable costs (which is from product and service costing variable indirect and direct costs ), to get CM 1 , then minus fixed indirect from cost center accounting, to get profit or loss
what is meants by stuff not influencing shareholders equity
so when there is not a decrease in assets or an increase in liability
how is repaying a loan not relevant to shareholders equity
you minus cash from asssetts but then you also decrease the liabilities so in the end your total worth does not change,
how does paying dividents not relevant to shareholders equity
you take some cash from assets and you pay dividends in liabilities so again both are proportional so nothing changes
what is salary of a manager where the plant only produces one product (fixed/varibale direct/indirect)
fixed direct
direct bc you only make one thing so can directly apply, if you would make many things you couldn’t directly apply
when are expenses costs?
when expenses are operationaly relevant
is cash needed for opertation?
yes
are finished production needed for operation?
yes
are accounts receivable needed for operation?
yes
