Intro to Strategic Cost Management Flashcards

1
Q

What is management?

A

Process of planning, decision making, organizing, leading, motivating, and controlling resources of an organization to reach its goals efficiently and effectively

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2
Q

Four management functions

A

> > Planning
Organizing
Leading
Controlling

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3
Q

What is planning?

A

Answer the question “What to do?”

Determine the proper course of action and strategize tactics to enforce in order to achieve the goals set

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4
Q

What is organizing?

A

Coordinating activities and resources and delegate responsibilities

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5
Q

What is leading?

A

Guiding people with motivation and direction

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6
Q

What is controlling?

A

Answers the question “Were we able to achieve the goals?”

Monitoring and evaluating activities to ensure they answer the goals being set

Includes performance evaluations and Variance analysis
&raquo_space;> Actual vs. Goals set; What is the cause of the difference?

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7
Q

What is Accounting?

A

A service activity that provides quantitative information to be used in making economic decisions

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8
Q

What is Strategic Cost Management?

A

The use of cost information as a tool for decision making and business development that would support the strategic placement of an entity

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9
Q

Strategic Placement in relation with costs

A

Cost leadership
&raquo_space;> Lower Costs > Lower Prices > Higher Revenue
&raquo_space;> Many will buy due to cheap prices

Product Differentiation
&raquo_space;> Regulated Costs > Unique Products > Higher Prices > Higher Revenue
&raquo_space;> Many will buy due to unique products

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10
Q

What is Management Accounting?

A

The use of accounting information to serve as a primary tool for the INTERNAL USERS of accounting information for DECISION MAKING which would add value to the entity

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11
Q

What is a Vision?

A

It describes how the company sees itself in the future

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12
Q

What is a Mission?

A

It describes what the company must do to achieve its vision

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