Chapter 18 - Managerial Flashcards

1
Q

Where do product costs appear?

A

On both the income statement and the balance sheet

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2
Q

How do you determine gross margin?

A

Sales - Cost per unit

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3
Q

Beginning Materials + Purchases - Ending Inventory Equals

A

Materials Used

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4
Q

Managers use managerial information to

A

evaluate the performance of a company’s operations, support long-term planning decisions, and determine the cost of manufacturing a product

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5
Q

What statement is cost of merchandise sold on

A

The income statement

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6
Q

In the income stastement of a manufacturing company, what replaces purchases in the cost of goods section of a retail company?

A

Cost of goods manufactured

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7
Q

Direct labor wages, Machine operator wages, and assembly line wages are all

A

Prime costs

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8
Q

Direct materials, Direct labor and factory overhead are all

A

Product costs

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9
Q

What are two examples of conversion costs?

A

Direct labor cost and facotry overhead costs

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10
Q

Another term for factory overhead is

A

Factory burden

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11
Q

The cost of materials entering directly into the manufacturing process is clasified as

A

Direct materials cost

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12
Q

What is the primary criterion for the preparation of managerial accounting reports?

A

Meet the manager’s needs

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13
Q

What form of accounting may rely on estimates and forecasts

A

Most associated with managerial accounting

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14
Q

In most business organizations, the chief management accountant is called the

A

Controller

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15
Q

The controller’s staff often consists of several management accountants. All of the following would most likely be on the controller’s staff

A

General accountants, budgets and budget analysts, and cost accountants

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16
Q

What type of accounting is prepared according to management’s needs?

A

Managerial accounting

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17
Q

In order to be useful to managers, management accounting reports should possess all of the following characteristics

A

provide objective measures of past operations and subjective estimates about future decisions, be provided at any time managment nees information and be prepared to report information for any unit of the business to support decision making

18
Q

What are the basic functions of management?

A

Planning and controlling

19
Q

The process of developing the organization’;s objectives and goals is

A

Planning

20
Q

What is the principle reason for preparing managerial accounting reports?

A

Usefulness to management

21
Q

What is not a characteristsic of useful managerial accounting reports?

A

GAAP

22
Q

What is false in regards to direct materials for an auto manufacturer

A

Small plastic clips to hold on door panels, because they become part of the auto, must be accounted for as direct materials

23
Q

The costs of a manufactured product generally consists of which of the following costs?

A

Direct labor, direct materials and factory overhead

24
Q

How do we compute conversion costs?

A

Direct Labor + Factory Overhead

25
Q

What is strategic planning

A

Developing long-term actions to achieve the company’s objectives

26
Q

What is operational planning?

A

Developing short term actions for managing the day-to-day operaqtions of the company

27
Q

Materials inventory is sometimes called what?

A

Raw Materials Inventory

28
Q

What is the difference between period costs and product costs?

A

Product costs consist of manufactoring costs and period costs consist of selling and administrative expenses

29
Q

What are the phases of the management process?

A

Planning, directing, controlling, improving, and decision making.

30
Q

Financial accounting statements are used by….

A

shareholders, creditors, government agencies and general public.

31
Q

Who is above a senior vice president?

A

CEO and or President

32
Q

What are the two types of labor?

A

Direct labor is the cost of the wages of the employees that is an integral part of the finished product Indirect labor affects not only the specific product (janitorial labor)

33
Q

What is the purpose of a staff department?

A

A staff department provides services, assistance, and advice to the departments with line or other staff responsibilities
.

34
Q

Managerial accounting can be defined as?

A

information desighned to meet the specific needs of a company’s management

35
Q

Name an objective measure?

A

Historical data

36
Q

Name a subjective estimate?

A

Estimated data

37
Q

What is the Chief Financial officer in charge of?

A

Responsible for specialized accounting functions

38
Q

An integral part of the finished product is called?

A

Direct Materials

39
Q

What is finished goods inventory?

A

constists of completed products

40
Q

Line Department

A

People involved in providing goods or services to the customers of the company