Random But In Order Flashcards
A cost is describe as staying the same over a certain activity range and then increasing but remaining stable over a revised activity range in the short term.
Stepped fixed cost
Procedures for material
- Raise a purchase order
- Checks GRN
- Update the stores ledger account for purchase
- Raise store requisition note
Business objectives
Corporate objectives relate to the organisation as a whole
It is possible for a division of an organisation to have its own specific objectives
What would be the effects on the EOQ and the total annual holding cost of a decrease in the cost of ordering a batch of raw material?
EOQ lower
Total annual holding cost lower
Which department would normally be responsible for completing a standard purchase requisition for goods in a service organisation?
B) the department that requires the goods.
A) the buying (purchasing) department - manufacturing.
C) the goods inwards department
D) the accounting department staff
[Both for product manufacturing]
Double entry,
COMPLETION OF PRODUCTION
Dr Finished good
Cr WIP
Double entry,
Absorption of production
Dr WIP
Cr POH
Double entry,
Direct labour cost being charged to production
Dr WIP
Cr wages control
Double entry,
Production has been completed
Dr Finished goods
Cr WIP
Accounts in
Integrated accounting system
Interlocking accounting system
Integrated,
Receivable control
WIP control
Interlocking,
Cost ledger control
Financial ledger control
Double entry,
Over-absorbed of production overhead
Dr Production overhead
Cr Income statement
Double entry,
Under-absorbed of overhead
Dr Income statement
Cr Production overhead
When GOODS ARE SOLD, what double-entry would be made to record the TRANSFER OF COSTS?
Dr Cost of sales acc
Cr Finished goods acc
Why is marginal costing better for decision making than absorption costing?
It separates relevant variable costs from irrelevant fixed cost
Opportunity cost
The benefit lost by taking up one business opportunity in favour of another.
Relevant cost for decision making
Opportunity
Incremental
Differential
Current
Raven Co is considering a new investment and is following the steps of the decision making and control cycle.
Which step of the cycle follows immediately after detailed evaluation?
Authorisation
How do public sector capital budgeting decisions differ from private sectors ones?
They take into account social cost and social benefits
Payback period
Initial outlay - disposal
———————————
Cash inflow
Payback period
Profit figure - Depreciation
After profit - kena tmbh depreciation
Before no need
NPV
Kalau soalan ada state IRR ambil percentage IRR
NPV become 0, ignore NPV value
IRR=NPV=0
Maximise profit
Cari contribution per hour
Take the highest one
Sales Revenue at Breakeven Point
Contribution/c/s ratio = FC/c/s ratio
Payback period
Expected cash inflows + depreciation / scrap value
At Breakeven point
Sales revenue=total costs
No profit / profit=0
Total contribution=fixed costs [S-V=F]
Payback period
Initial investment ÷ annual net cash inflow
A company is considering an immediate investment in new machinery. The machinery would cost $100,000 with expected net cash inflows of $30,000 per year starting in Year 1. The disposal value of the machine after five years is expected to be $10,000. $15,000 has already been incurred on development costs.
What is the payback period of the investment based on future incremental cash flows?
100000÷30000=3.3 years
Disposal x pyh tolak sbb dia x bagi profit
Disadvantage of the payback method of investment appraisal
It doesn’t account for the cost of capital in making investment devisions.
Payback for an investment
[ a measure of how long it will take to recover the initial cash spending on an investment]
1) does not measure the value of an investment/ the expected return on investment that it will provide.
2) it ignores all cash flows & returns after payback has been achieved.
3) often used as an initial step in appraising a project. However, a project should not be evaluated on the basis of payback alone.
In a CVP graph, the break-even point is at the intersection of the salesline an the___
Total cost line
CVP analysis does not consider
Fixed cost per unit
NOT an underlying assumption of CVP analysis
Cost classifications are reasonably accurate
Capital investment ranking
- NPV = +
- Payback = shorter
- IRR = more than company policy [highest]
Advantages to the company if implementing a software package solution to manage order processing?
Legistative changes may be uncorporated automatically in periodic updates.
There may be a large user group to share experiences
Definition of central processing unit CPU
It is the piece of computer equipment for processing data
Definition of central processing unit CPU
It is the piece of computer equipment for processing data
An employee did not receive payment for overtime last month and rising this with the payroll department. Which of the following is the most appropriate method of communication?
Telephone call
Advantages of an email system
Documents & spreadsheets may be attached to messages.
Messages can be sent and received quickly and cheaply
Data can be sent to multiple users in one message
Data users
Individuals or organisations that control personal data.
Data subjects
Individuals or organisations that have personal data held on them.
An individual who is the subject of personal data.
Personal data
Any information that, either on its own or when combined with other data available to the business, can identify a specific individual. Eg,name,address
Data controller
Is the person or entity that determine s the purpose and manner in which personal data is processed.
Data processor
Refers to any person or entity (other than an employee of a data controller) who processes personal data on behalf of the data controller.
Data processing
Covers a wide range of activities including obtaining, recording, or holding personal data or carrying out any operation on the personal data, such as organising, amending, disclosing, using, transmitting or otherwise making the personal data available.
Buffer inventory
The inventory that is kept in reserve to cope with fluctuations in demand and with suppliers
The introduction of buffer inventory would results
In the increase of average inventory levels.
Would not have an effect on holding cost, ordering costs nor the EOQ.
Typical measure of output wastage
Number of quality rejects as a percentage of total output
Perpetual inventory system
Records every receipt and issue of inventory as they occur
Input wastage
Quantity of materials wasted as a percentage of the quantity of material used.
Rework
Rework costs as a percentage of production costs.
Wastage control measures
Input wastage
Output wastage
Rework
Obsolecsene = keusangan
When materials or components become out-of-date and are no longer required, existing inventories must be thrown away and their cost must be written off to the SOPL
Deterioration = Kemerosotan
When materials in store deteriorate to the extent that they are unusable, they must be thrown away ( with the likelihood that disposal costs would be incurred ) and again, the value written off inventory plus the disposal costs will be a charge to the SOPL
