Final Exam Brain Dump

Question 1

Financial Accounting

Answer 1

Historical, GAAP, Requirement, Precision, External, Whole Company, Verifiability

Question 2

Managerial Accounting

Answer 2

Future, no GAAP, not Required, Timeliness, Segments of Company, Relevance

Question 3

Variable vs Mixed vs Fixed

Answer 3

Variable = In total: cost changes as activity level changes; Per Unit: per unit remains the same over wide ranges of activity
Mixed =
Fixed = In total: remains the same even when activity level changes; Per Unit: Avg fixed cost per unit goes down as activity level goes up

Question 4

CM Equation

Answer 4

Sales - Var Exp

Question 5

CM Ratio Equation

Answer 5

CM / Sales

Question 6

Break-Even Point Equation

Answer 6

Fixed Cost / CM per unit OR CM ratio

Question 7

Special Order Equation

Answer 7

Inc in Rev - Inc in Exp

Question 8

MPV Equation

Answer 8

(AQ x AP) - (AQ x SP)
AQ (AP - SP)

Question 9

MQV Equation

Answer 9

(AQ x SP) - (SQ x SP)
SP (AQ - SQ)

Question 10

Product

Answer 10

Traceable

Question 11

Period

Answer 11

Selling & Admin
Ex: Salary of chief executive & Wages for retail store worker

Question 12

Targeted Sales Equation

Answer 12

Targeted + Fixed / CM units

Question 13

Margin of Safety

Answer 13

Target NOI Sales - BE sales

Question 14

Degree of Safety

Answer 14

Total CM / NOI

Question 15

Relevant Costs

Answer 15

Avoidable costs
Future costs that do differ

Question 16

Irrelevant Costs

Answer 16

Unavoidable costs
Sunk costs
Future costs that do not differ

Question 17

NPV

Answer 17

0 and above are acceptable
Negative is not acceptable