Prelim

Question 1

set of aclivities that convert raw materials/resources into goods and services purchased and consumed by the end-users.

Answer 1

Value Chain

Question 2

set of firms and individuals that sell goods and services to the firm.

Answer 2

Supply Chain

Question 3

set of firms and individuals that buy and distribute goods and services from the firm.

Answer 3

Distribution Chain

Question 4

creates the value for which the customer is willing to pay.

Answer 4

Value chain

Question 5

designed to provide users with the information for decision-making.

Answer 5

Accounting systems

Question 6

focuses on reporting financial information to external parties such as investors, government agencies, banks, and suppliers based on Generally Accepted Accounting Principles (GAAP).

Answer 6

Financial Accounting

Question 7

process of measuring, analyzing, and reporting financial and non-financial information that helps managers make decisions to fulfill the goals of an organization.

Answer 7

Management Accounting

Question 8

process of measuring, analyzing, and reporting financial and non-financial information related to the costs of acquiring or using resources in an organization.

Answer 8

Cost accounting

Question 9

This involves production, marketing, and distribution management, which is directly responsible for achieving the organization’s goals.

Answer 9

Line Management

Question 10

This involves management accountants, information technology, and human-resources management, providing advice, support, and assistance to line management.

Answer 10

Staff management

Question 11

These activities do not add value to the goods or services from the customers* perspective.

Answer 11

Non- Value -Added Activities

Question 12

This is the concept of considering both the costs and benefits of a proposal.

Answer 12

Cost - Benefit Analysis

Question 13

specific unit of an organization assigned to a manager who is held accountable for its operations and resources.

Answer 13

Responsibility center

Question 14

Manages entire finance and accounting function

Answer 14

Chief Financial Officer (CFO)

Question 15

Manages liquid assets

Conducts business with banks and other financial institutions

•Oversees public issues of stock and debt

Answer 15

Treasurer

Question 16

Plan and designs information and incentive systems

Answer 16

Controller

Question 17

Ensures compliance with laws, regulations and company policies and procedures

Provides consulting and auditing services within the firm

Answer 17

Internal Auditor

Question 18

Records, measures, estimates, and analyzes costs
• Works with financial and operational managers to provide relevant information for decisions

Answer 18

Cost Accountant

Question 19

reveals the economic measure of resources used to accomplish an objective like manufacturing a product.

Answer 19

Cost

Question 20

a set of recognized methods developed for planning and controling an organization’s cost-generating activities relative to its strategy, goals, and objectives.

Answer 20

Cost management system

Question 21

Any item for which costs are being separately measured. It is a key concept used in managing the costs of a business. Production operations and product lines are common cost objects.

Answer 21

Cost Object

Question 22

Costs related to product-making. These costs associated with any cost object are classified according to their relationship with the cost object.

Answer 22

Product Costs

Question 23

Costs directly identified with finished goods or those that are conveniently and economically traceable to the cost object.

Answer 23

Direct cost

Question 24

Costs indirectly associated with finished goods or those that cannot be economically traced. These costs are allocated instead to the cost object.

Answer 24

Indirect costs

Question 25

refers to a limited span of volume or activity.

Answer 25

Relevant Range

Question 26

vary in total in direct proportion to changes in production volume. This cost is constant on a per unit basis as activity changes within a relevant range.

Answer 26

Variable costs

Question 27

are constant in total within the relevant range of activity but variable on a per-unit basis.

Answer 27

Fixed costs

Question 28

has both a variable and a fixed component.

Answer 28

Mixed cost

Question 29

are related to making or acquiring the products that directly generate the revenues of an entity.

Answer 29

Product costs

Question 30

operating expenses related to business functions other than production, such as selling and administration. These costs are non-manufacturing costs. These costs are more closely associated with a particular period than making or acquiring a product.

Answer 30

Period costs

Question 31

Any material that can be easily and economically traced to a product being produced.

Answer 31

Direct Material

Question 32

This refers to the time spent by individuals who work specifically on manufacturing a product.

Answer 32

Direct Labor

Question 33

Any production cost that is indirect to the product. It includes factory supervisors’ salaries and depreciation, insurance, and utility costs on production machinery, equipment, and facilities

Answer 33

Overhead

Question 34

Sum of direct labor and overhead

Answer 34

Conversion cost

Question 35

Sum of direct materials and direct labor

Answer 35

Prime cost

Question 36

refers to assigning an indirect cost to one or more cost objects using some reasonable allocation base or driver.

Answer 36

Cost Allocation