Chapter 2 Flashcards

1
Q

system

A

set of interrelated parts that performs one or more processes to accomplish specific objectives

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2
Q

accounting information systems

A

consists of interrelated manual and computer parts and uses processes such as collecting, classifying, summarizing, analyzing, and managing data to provide information to users
The overall objective of an accounting information system is to provide info to users
Two key features of the accounting info system
first the inputs are economic events
two the operational model of an accounting info system is critically involved with the user

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3
Q

Accounting Info Systems subsystems

A
  1. the financial accounting info system

2. the cost management info system

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4
Q

Financial Accounting System

A

primarily concerned with giving outputs for external users

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5
Q

Cost Management Information System

A

concerned with producing outputs for internal users
provides
1. Costing Services, products, and other objects of interest management
2. Planning and control
3. Decision Making

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6
Q

value chain

A

the set of activities required to design, develop, produce, market, deliver, and provide post sales service for the products and services sold to customers

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7
Q

Cost Accounting Information Systems

A

cost management subsystem designed to assign costs to individual products and services and other objects of interest to managers

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8
Q

Operational Control Information System

A

a cost management subsystem designed to provide accurate and timely feedback concerning the performance of managers and others relative to their planning and control of activities

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9
Q

Cost

A

the cash or cash equivalent value sacrificed for goods and services that are expected to bring a current or future benefit to the organization.

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10
Q

Expenses

A

Expired costs

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11
Q

Assets

A

Un-expired costs

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12
Q

Cost objects

A

anything for which costs are measured and assigned

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13
Q

Activity

A

basic unit of work performed within an organization

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14
Q

Indirect Costs

A

costs that cannot be traced easily and accurately to a cost object

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15
Q

Direct Costs

A

costs that can be traced easily and accurately to a cost object

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16
Q

Traceability

A

the ability to assign a cost directly to a cost object

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17
Q

Direct Tracing

A

the process of identifying and assigning costs to a cost object that are specifically or physically associated with the cost object

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18
Q

Drivers

A

factors that cause changes in resource usage, activity usage, costs, and revenues

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19
Q

Driver Tracing

A

the use of drivers to assign costs to cost objects

20
Q

Allocation

A

assignment of indirect costs to cost objects

21
Q

tangible products

A

goods produced by converting raw materials into finished goods

22
Q

services

A

tasks or activities performed for a customer or an activity performed by a customer using an organizations product or facilities

23
Q

production costs

A

are those costs associated with the functions of selling and administration

24
Q

non-production costs

A

costs associated with the functions of selling and administration

25
Q

direct materials

A

those materials traceable to the good or service being produced

26
Q

direct labor

A

labor that is traceable to the goods or services being produced

27
Q

overhead

A

all production costs other than direct materials and direct labor are lumped into one category called overhead

28
Q

supplies

A

generally those materials necessary for production that do not become part of the finished product or are not used in providing a service

29
Q

indirect materials

A

direct materials that form an insignificant part of the final product are usually lumped into the overhead category called indirect materials

30
Q

prime cost

A

the sum of direct materials cost and direct labor cost

31
Q

conversion cost

A

the sum of direct labor cost and overhead cost

32
Q

period costs

A

are expensed in the period in which they occur

33
Q

Marketing (selling) costs

A

costs necessary to market and distribute a product or service

34
Q

administrative costs

A

all costs that cannot be reasonably assigned to either marketing or producttion

35
Q

absorption costing income or full costing income

A

all manufacturing costs are fully assigned to the product

36
Q

costs of goods sold

A

the cost of direct materials, direct labor, and overhead attached to the units sold

37
Q

cost of goods manufactured

A

the total manufacturing cost of goods completed during the current period

38
Q

work in process

A

consists of all partially completed units found in production at a given point in time

39
Q

COGM

A

B Inv + Purchases - E Inv+ DL + MO +B WIP - E WIP = COGM

40
Q

COGS

A

COGM + B Fin Goods=COG Available for sale-E Fin Goods=COGS

41
Q

Traditional cost system

A

uses only unit based activity drivers to assign costs to a cost object

42
Q

traditional operation control system

A

assigns costs to organizational units and then holds the organizational unit manager responsible for controlling the assigned costs

43
Q

Activity based cost system

A

cost accounting system that uses both unit and non unit based activity drivers to assign activity costs to cost objects is called

44
Q

Activity based management

A

focuses on the management of activities with the objective of improving the value received by the customer and the profit received by the company in providing this value

45
Q

measurement costs

A

the costs associate with the measurements required by the cost management system

46
Q

error costs

A

the costs associated with making poor decisions based on bad cost information