Chapter 1 Flashcards
Measures and reports financial and non-financial information related to the cost of acquiring and using resources
Cost Accounting
Identifying, reporting and analyzing costs of operations.
Cost Management
Focus on reporting to external parties (investors, regulators and others) with the goal of fairly presenting the economic health of a company
Financial Accounting
Based on generally accepted accounting principles (IFRS and ASPE in Canada).
Financial Accounting
Measures, analyzes, and reports financial and non-financial information to internal managers.
Management Accounting
______________ reorganize and analyze financial and nonfinancial data using rigorous methods.
Management Accounting
Describe the business functions in the value chain
Research and Development, Design of Products, Services or Processes, Production, Marketing, Distribution, and Customer Services
Describe the five-step decision-making process.
(1) Identify the problem and uncertainties
(2) Obtain relevant information
(3) Make predictions about the future
(4) Decide on one of the available alternatives
(5) Implement the decision, evaluate performance, and learn.
What three guidelines help management accountants provide the most value to managers?
(1) Employ a cost-benefit approach
(2) Recognize behavioural and technical considerations
(3) Identifying relevance and that decisions require “different costs for different purposes”
Classify the cost items as one of the business functions of the value chain.
Cost of redesigning blister packs to make drug containers more tamper-proof.
Design
Classify the cost items as one of the business functions of the value chain.
Cost of videos sent to doctors to promote sales of a new drug
Marketing
Classify the cost items as one of the business functions of the value chain.
Cost of a toll-free telephone line used for customer inquiries about usage, side effects of drugs, and so on.
Customer Service
Classify the cost items as one of the business functions of the value chain.
Equipment purchased by a scientist to conduct experiments on drugs awaiting approval by the government.
Research & Development
Classify the cost items as one of the business functions of the value chain.
Payment to actors in an infomercial to be shown on television promoting Visudyne, a new treatment for age-related progressive blindness.
Marketing
Classify the cost items as one of the business functions of the value chain.
Labour costs of workers in the packaging area of a production facility.
Production
Classify the cost items as one of the business functions of the value chain.
Bonus paid to a salesperson for exceeding a monthly sales quota.
Marketing
Classify the cost items as one of the business functions of the value chain.
Cost of the Purolator courier services to deliver drugs to hospitals.
Distribution
Classify each action below according to its step in the five-step decision-making process.
Mr. Brite calls Home Depot to ask the price of paint sprayers.
Obtain information
Classify each action below according to its step in the five-step decision-making process.
Mr. Brite discusses with his employees the possibility of growing revenues of the firm.
Identify the problem and uncertainties
Classify each action below according to its step in the five-step decision-making process.
One of Mr. Brite’s project managers suggests that using paint sprayers instead of hand painting will increase productivity and thus revenues.
Make predictions about the future
Classify each action below according to its step in the five-step decision-making process.
Mr. Brite compares the expected cost of buying sprayers to the expected cost of hiring more workers who paint by hand, and estimates profits from both alternatives.
Make predictions about the future
Classify each action below according to its step in the five-step decision-making process.
The workers who are not familiar with paint sprayers take more time to finish a job than they did when painting by hand.
Implement the decision, evaluate performance, and learn
Classify each action below according to its step in the five-step decision-making process.
The project scheduling manager confirms that demand for house painting services has increased.
Obtain information
Classify each action below according to its step in the five-step decision-making process.
Mr. Brite decides to buy the paint sprayers rather than hire additional painters.
Choose among alternatives
