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Accounting Definitions > M Accounting Definitions > Flashcards

M Accounting Definitions Flashcards

1
Q

<p>Maintenance</p>

A

<p>Expenditures necessary to achieve the originally anticipated useful life of a fixed asset. (IMA)</p>

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2
Q

<p>Make Versus Buy</p>

A

<p>The decision either to produce a good or service with an entity's own resources or to buy it from an outside supplier. (IMA)</p>

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3
Q

<p>Managed Floating Exchange Rates</p>

A

<p>An exchange rate that is mostly allowed to change (float) as demand in currency supply and demand changes but is often altered (managed) by governments through their buying and selling of certain currencies. (IMA)</p>

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4
Q

<p>Management</p>

A

<p>The process of leading and directing all or part of an organization, often a business, through the deployment and organization of resources. (IMA)</p>

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5
Q

<p>Management Accounting</p>

A

<p>The process of identification, measurement, accumulation, analysis, preparation, interpretation, and communication of financial information used by internal decision makers in order to plan, evaluate, and control an entity and to assure appropriate use of and accountability for its resources. (Also called Managerial Accounting.) (IMA)</p>

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6
Q

<p>Management Control</p>

A

<p>An organized, integrated process and structure through which management attempts to achieve enterprise goals effectively and efficiently. (IMA)</p>

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7
Q

<p>Management Discussion and Analysis</p>

A

<p>A discussion of Management's views of an entity's performance, required by the US Securities and Exchange Commission to be included in the Annual Report on Form 10-K. (IMA)</p>

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8
Q

<p>Management Information System</p>

A

<p>A system that provides past, present, and prospective information about internal operations and external intelligence. (IMA)</p>

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9
Q

<p>Management-by-Exception</p>

A

<p>The management practice of focusing on areas that deserve attention and ignoring areas that seem to be running smoothly. (IMA)</p>

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10
Q

<p>Manufacturing</p>

A

<p>The transformation of raw materials into finished goods. (IMA)</p>

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11
Q

<p>Manufacturing Contribution Margin</p>

A

<p>The amount of money that is available to cover nonmanufacturing variable costs, all fixed costs and then flow to profit. (HOCK)</p>

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12
Q

<p>Manufacturing Cost</p>

A

<p>The costs incurred to transform materials into other goods through labor and factory facilities. (IMA)</p>

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13
Q

<p>Margin of Safety</p>

A

<p>The excess of budgeted sales over the break-even volume. (IMA)</p>

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14
Q

<p>Marginal Cost</p>

A

<p>Cost resulting from the production of one additional unit. (IMA)</p>

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15
Q

<p>Marginal Cost Of Capital</p>

A

<p>The cost of the next dollar of finance. (HOCK)</p>

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16
Q

<p>Marginal Product</p>

A

<p>The additional output that is produced from adding one additional unit of input. (HOCK)</p>

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17
Q

<p>Marginal Profit</p>

A

<p>The additional profit that is received from producing and selling one more unit of product. (HOCK)</p>

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18
Q

<p>Marginal Revenues</p>

A

<p>The revenue that is obtained from selling one more unit of product. (HOCK)</p>

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19
Q

<p>Mark-Up Pricing</p>

A

<p>A pricing strategy in which the company determines what its costs are and then adds a standard markup percentage to the cost to arrive at the price for the product. (HOCK)</p>

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20
Q

<p>Market Comparables</p>

A

<p>Estimating the price of an asset by comparing to recent sales prices of assets with similar characteristics. (IMA)</p>

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21
Q

<p>Market Equilibrium Price</p>

A

<p>The price of a good or service that will balance the supply and demand. (IMA)</p>

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22
Q

<p>Market Penetration</p>

A

<p>A measure of an entity's sales of a given product or service compared to the total sales of all suppliers in the market. (Also called Market Share.) (IMA)</p>

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23
Q

<p>Market Penetration Pricing</p>

A

<p>A pricing strategy for a new product in which the company wants to gain market share quickly and sets a low price for its product. (HOCK)</p>

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24
Q

<p>Market Price</p>

A

<p>The current price for which a good or service is offered in the marketplace. (IMA)</p>

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25
Q

<p>Market Risk</p>

A

<p>The portion of stock price (or portfolio) movement that is attributable to the movement of the market as a whole. (Also called Systematic Risk.) (IMA)</p>

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26
Q

<p>Market Share Variance</p>

A

<p>The difference in the budgeted contribution margin caused by the actual market share being different from the expected market share. (HOCK)</p>

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27
Q

<p>Market Size Variance</p>

A

<p>The difference in the budgeted contribution margin caused by the actual market size (in number of units) being different from the expected market size (in number of units). (HOCK)</p>

28
Q

<p>Market Skimming Pricing</p>

A

<p>Charging a relatively high price for a short time when a new, innovative, or much-improved product is launched onto a market. (IMA)</p>

29
Q

<p>Market Structure</p>

A

<p>The organizational and other characteristics of a market, in particular those that affect the nature of competition and pricing. (IMA)</p>

30
Q

<p>Market Value</p>

A

<p>The value of a good, a service, or a security as determined by buyers and sellers in an open market. (IMA)</p>

31
Q

<p>Market-Based Transfer Price</p>

A

<p>When the price for goods or services charged by one division of a company to another is based on the market price. (IMA)</p>

32
Q

<p>Market-to-Book Ratio</p>

A

<p>Current stock price divided by book value per share, where "book value" equals common shareholders' equity. (Also called Price-to-Book Ratio.) (IMA)</p>

33
Q

<p>Marketability</p>

A

<p>A characteristic of a security that allows it to be sold at a reasonable price in a short period of time. (IMA)</p>

34
Q

<p>Marketable Securities</p>

A

<p>1. Liquid securities that can be converted into cash quickly. 2. A balance sheet classification for negotiable financial instruments. (IMA)</p>

35
Q

<p>Master Budget</p>

A

<p>A budget that consolidates all budgets into an overall plan and control document, for a budgeted period. (Also called a Comprehensive Budget.) (IMA)</p>

36
Q

<p>Matching</p>

A

<p>The process of recognizing expenses in the same accounting period as that in which the related revenues are recognized. (IMA)</p>

37
Q

<p>Material Requirements Planning (MRP)</p>

A

<p>A system that translates a production schedule into requirements for each component needed to meet that schedule. (IMA)</p>

38
Q

<p>Materiality</p>

A

<p>The concept that accounting should separately recognize only those events that are relatively important for understanding an entity's statements. (IMA)</p>

39
Q

<p>Materials Price Variance</p>

A

<p>Measures how much of the total variance was due to a difference in the price between what we expected it to be per unit and what it the price paid actually was. (HOCK)</p>

40
Q

<p>Materials Quantity Variance</p>

A

<p>Measures how much of the total variance was due to a difference in the quantity between what we expected to use and what was actually used. (HOCK)</p>

41
Q

<p>Maturity Date</p>

A

<p>The date on which a debt becomes due for payment. (IMA)</p>

42
Q

<p>Maturity Matching</p>

A

<p>The matching of asset and liability maturities; i.e., financing long-term assets with long-term sources and short-term needs with short-term sources. (IMA)</p>

43
Q

<p>Maturity Stage</p>

A

<p>The fourth stage in the life cycle of a product, during which the sales growth usually slows down and profits level off or decrease. The company has to spend more for marketing to defend the product against the competition. (HOCK)</p>

44
Q

<p>Maximum Possible Loss</p>

A

<p>The most pessimistic view of possible loss; when referring to insurance of a building, for example, the risk that the entire structure, its immediate surroundings, and all the building's contents will be destroyed. (Also called Extreme or Catastrophic Loss.) (IMA)</p>

45
Q

<p>Maximum Probable Loss</p>

A

<p>The largest loss that can occur under foreseeable circumstances. This is the largest amount of damage that is likely to occur in a very bad year. (HOCK)</p>

46
Q

<p>Mean</p>

A

<p>The average of a set of numbers. (HOCK)</p>

47
Q

<p>Means-End Relationship</p>

A

<p>When the achievement of the objectives of one level enables the next highest level to achieve its objectives as well. (HOCK)</p>

48
Q

<p>Median</p>

A

<p>The halfway value if raw data is arranged in numerical order from lowest to highest. (HOCK)</p>

49
Q

<p>Merger</p>

A

<p>The combining of two or more companies. (IMA)</p>

50
Q

<p>Mix Variance</p>

A

<p>A variance that results when actual proportions of the components of revenues or costs are different from the proportions used in arriving at the budgeted or planned revenue or cost, or the standard cost. (IMA)</p>

51
Q

<p>Mixed Cost</p>

A

<p>A cost composed of fixed and variable elements. (IMA)</p>

52
Q

<p>Mode</p>

A

<p>The most frequently occurring value. (HOCK)</p>

53
Q

<p>Monetary Items</p>

A

<p>Money or a claim (an obligation) to receive (or pay) a sum of money, the amount of which is fixed or determinable without reference to future prices of specific goods and services. (IMA)</p>

54
Q

<p>Money Market Accounts</p>

A

<p>An account that pays a higher interest rate than a standard savings account, but may have restrictions on the number of transactions that may be done in the account during a time period. (HOCK)</p>

55
Q

<p>Money Markets</p>

A

<p>Markets where short-term debt instruments with maturities of less than one year are traded. (HOCK)</p>

56
Q

<p>Monitoring</p>

A

<p>Assesses the quality of the performance of anything over time. (HOCK)</p>

57
Q

<p>Monopolistic Competition</p>

A

<p>A situation where there are a large number of independent sellers, each producing a differentiated product in a market with low barriers to entry. (IMA)</p>

58
Q

<p>Monopoly</p>

A

<p>A market structure characterized by a single seller of a well defined product for which there are no good substitutes and by high barriers to the entry of any other firms into the market for that product. (IMA)</p>

59
Q

<p>Monte Carlo Technique</p>

A

<p>An analytical technique in which a large number of simulations are run to infer the most likely result, using random quantities for uncertain variables. (IMA)</p>

60
Q

<p>Mortgage</p>

A

<p>A claim given by the borrower to the lender against the borrower's property. (IMA)</p>

61
Q

<p>Mortgage Bonds</p>

A

<p>Bonds that have specific asset(s) pledged as the collateral for the loan. This collateral makes the bonds less risky to investors. (HOCK)</p>

62
Q

<p>Moving Average</p>

A

<p>A method of calculating central tendency over time in an attempt to identify long-term trends. The average is calculated over a specific time period (e.g. years). For each time period after the initial one, the earliest value is dropped from the calculation and the most recent one is added in, to make an average over the same length of time. (IMA)</p>

63
Q

<p>Multinational Company</p>

A

<p>Company operating in several countries. (IMA)</p>

64
Q

<p>Multiple Regression</p>

A

<p>A statistical method used to model the relationship between one dependent (or response) variable and one or more independent (or explanatory) variables by fitting a linear equation to observed data. (Also called Multiple Linear Regression.) (IMA)</p>

65
Q

<p>Mutually Exclusive Project</p>

A

<p>Competing investment projects in which accepting one project eliminates the possibility of undertaking the remaining projects. (IMA)</p>

66
Q
A

Accounting Definitions (15 decks)

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