Acct 212 Managerial Accounting, Chapter 5 By Crosson, Needles

Front 1

Activity-based systems

Back 1

Information systems that provide quantitative information about an organization's activities.

Front 2

Backflush costing

Back 2

A product costing approach in which all product costs are first accumulated in the Cost of Goods Sold account and at the end of the period are "flushed back," or worked backward, into the appropriate inventory accounts.

Front 3

Batch-level activities

Back 3

Activities performed each time a batch of goods is produced.

Front 4

Bill of activities

Back 4

A list of activities and related costs that is used to compute the costs assigned to activities and the product unit cost.

Front 5

Conversion costs

Back 5

The sum of the direct labor costs and overhead costs incurred by a production department, work cell, or other work center.

Front 6

Cost hierachy

Back 6

A framework for classifying activities according to the level at which their cost are incurred.

Front 7

Facility-level activities

Back 7

Activities performed to support a facility's general manufacturing process.

Front 8

Full product cost

Back 8

A cost that includes not only the costs of direct materials and direct labor, but also the costs of all production and nonproduction activities required to satisfy the customer.

Front 9

Inspection time

Back 9

The time spent looking for product flaws or reworking defective units.

Front 10

Just-in-time (JIT) operating philosophy

Back 10

An operating philosophy that requires that all resources--materials, personnel, and facilities--be acquired and used only as needed; it focuses on eliminated or reducing waste.

Front 11

Moving time

Back 11

The time spent moving a product from one operation or department to another.

Front 12

Nonvalue-adding activity

Back 12

An activity that adds cost to a product or service but does not increase its market value.

Front 13

Processing time

Back 13

The actual amount of time spent working on a product.

Front 14

Process value analysis (PVA)

Back 14

A technique that analyzes business processes by relating activities to the events that prompt those activites and to the resources that the activites consume.

Front 15

Product-level activities

Back 15

Activities performed to support a particular product line.

Front 16

Pull-through production

Back 16

A production system in which a customer's order triggers the purchase of materials and the scheduling or production for the required products.

Front 17

Push-through method

Back 17

A production system in which products are manufactured in long production runs and stored in anticipation of customer's orders.

Front 18

Queue time

Back 18

The time a product spends waiting to be worked on once it enters a new operation or department

Front 19

Storage time

Back 19

The time a product spends in materials storage, work in process inventory, or finished goods inventory.

Front 20

Supply chain

Back 20

The path that leads from the suppliers of the materials from which a product is made to the final customer.

Front 21

Throughput time

Back 21

The time it takes to move a product through the entire production process.

Front 22

Unit-level activities

Back 22

Activities performed each time a unit is produced.

Front 23

Value-adding activity

Back 23

An activity that adds value to a product or service as perceived by the customer.

Front 24

Value chain

Back 24

A sequence of activities, or primary processes, that add value to a product or service; also include support services that facilitate these activities.

Front 25

Work cell

Back 25

An autonomous production line that can perform all required operations efficiently and continuously.

Front 26

Activity-based costing

Back 26

A method of assigning costs that calculates a more accurate product cost than traditional methods by categorizing all indirect costs by activity, tracing the indirect cost to those activities, and assigning those costs to products using a cost driver related to the cause of the cost.

Front 27

Activity-based management (ABM)

Back 27

An approach to managing an organization that identifies all major operating activites, determines the resources cnosumed by each activity and the cause of the resources usage, categorizes the activities as either adding value to a product or service or not adding value, and seeks to reduce or eliminate nonvalue adding activities.