EVERY MANAGERIAL ACCOUNTING CHAPTER Flashcards
[Note: Stopped at page 25 in the book ]
What is an Activity Base?
A measure of what causes a variable cost
What are Administrative Costs?
Costs associated with the general management of an organization
What are committed fixed costs?
Investments in facilities, equipment, and structure that can’t be reduced w/o significant change
What is a Common Cost?
costs that cannot be traced to a individual cost object
What is the Contribution approach?
An income statement format organizing costs by behavior.
What is a Contribution Margin?
How much remains from sales revenue after all variable expenses are deducted
What is the Conversion Cost Formula?
Direct labor + Manufacturing Overhead
What is cost behavior?
How costs react to changes in activity levels
What is a cost object?
Anything for which cost data is desired.
What are cost structures?
The proportion of fixed, variable and mixed costs in an organization
What is a differential cost?
costs that differ between two alternatives
What is differential revenue?
revenue that differs between alternative goods
What are direct costs?
costs that can be traced back to a specific cost object
What is direct labor?
factory labor costs related to a specific products creation
What are direct materials?
materials that become a part of a finished product; can be traced
Discretionary fixed costs are..
costs that come from advertising and research decisions
What is Financial Accounting?
Accounting that reports financial history to stockholders, creditors, and regulators.
What are finished goods?
products that have not been sold
What is a fixed cost?
constant costs that do not change with the level of activity
What is a Incremental cost?
a increase in cost between two alternative goods
What is a Indirect cost?
a cost that is difficult to trace back to a cost object
What is indirect labor?
the labor cost of janitors, supervisors, material handler, and other factory workers
What are indirect materials?
materials such as glue and nails that cannot be easily traced
What is managerial accounting?
accounting that provides information to managers
What is manufacturing overhead?
manufacturing costs outside of direct materials and labor
What is a mixed cost?
costs with both variable and fixed cost elements
What is an opportunity cost?
benefits given up for something else
What is a period cost?
cost taken directly to the income statement as expenses
What is the prime cost formula?
direct materials + direct labor
What are product costs?
costs involved in making a good
What are raw materials?
materials that go into making a good