Chapter 1

Question 1

Financial accounting

Answer 1

External reporting that verifies companies uses of money

Question 2

Managerial accounting

Answer 2

Internal reporting that helps plan future goods of the company

Question 3

What does managerial acc do?

Answer 3

Plans, controls, makes decisions

Question 4

Ethics in managerial accounting guidelines

Answer 4

-Competency
- Confidentiality
- integrity
- Credibility

Question 5

Direct costs

Answer 5

Cost can easily be traced to a specific object.
- manufacturing overhead

Question 6

Indirect cost

Answer 6

Can’t be traced to a specific object

Question 7

Manufacturing overhead

Answer 7

Cost associated with manufacturing that can’t be traced

Question 8

Product costs

Answer 8

Direct materials + direct labor + manufacturing

Question 9

Period costs (general admin costs)

Answer 9

Selling exp + administrative exp

Question 10

Prime cost

Answer 10

Direct materials + direct labor

Question 11

Conversion cost

Answer 11

Direct labor + manufacturing overhead

Question 12

Variable costs

Answer 12

Constant per unit but changes the total depending on if you add or make less units

Question 13

Fixed costs

Answer 13

$Per unit varies but total stays the same
Can change though in the next period

Question 14

Mixed cost behavior → product costs

Answer 14

Moves from inventory on bs → cogs on is

Question 15

Differential costs

Answer 15

Cost difference between any 2 alternatives

Question 16

Differential revenue

Answer 16

Difference in reserves

Question 17

Sunk cost

Answer 17

Already been incurred and cannot be changed

Question 18

Traditional format is

Answer 18

Sales
Cogs
Gross margin
Selling and admin exp
Net operating income

Question 19

Contribution format is

Answer 19

Sales
Variable exp
Contribution margin
Fixed exp
Net operating income

Question 20

Cogs formula

Answer 20

Beg. Inv + purchases - ending inv