Acg 3301

Front 1

What are the three major activities that managers carry out?

Back 1

1. Planning
2. Directing and motivating
3. Controlling

Front 2

What are the three steps to planning?

Back 2

1. Identify alternatives.
2. Select alternative that does the best job of furthering organization's objectives.
3. Develop budgets to guide progress toward the selected alternative.

Front 3

Involves managing day-to-day activities to keep the organization running smoothly.

Back 3

Directing and Motivating

- Daily sales reports are often used in this type of decision making.

Front 4

_______ compares actual results with the budget are an essential part of ______ function.

Back 4

Performance reports; Control

Front 5

How many key differences are between managerial and financial accounting?

Back 5

7 key differences

*Know Slide 8 in Week 1

Front 6

What are the three main categories of manufacturing costs?

Back 6

1. Direct Materials
2. Direct Labor
3. Manufacturing overhead

- These three make a product.

Front 7

Raw materials that become an integral part of the product and that can be conveniently traced directly to it.

Back 7

Direct Materials

- Example: A radio installed in a car or the Intel processing chip in a PC

Front 8

Consists of that portion of labor cost that can be easily traced to a product. Also known as "touch labor".

Back 8

Direct Labor

- Example: Wages paid to automobile assembly workers.

Front 9

Includes all manufacturing costs except direct materials and direct labor. Cannot be traced directly to specific units produced.

Back 9

Manufacturing Overhead

- Example: Indirect materials and indirect labor.

* More info on Slide 13 Week 1

Front 10

What are the two classifications of non-manufacturing costs.

Back 10

1. Selling Costs - Costs necessary to get the order and deliver the product.
2. Administrative Costs - All executive, organizational, and clerical costs.

Front 11

What are the two types of costs?

Back 11

1. Product costs - include direct material, direct labor, and manufacturing overhead.
2. Period costs - are not included in product costs. They are expensed on the income statement.

Front 12

1. Consists of direct materials plus direct labor.
2. Consists of direct labor plus manufacturing overhead.

Back 12

1. Prime Cost
2. Conversion Cost

Front 13

1. Purchases finished goods from suppliers for resale to customers.
2. Purchases raw material from suppliers and produce and sell finished goods to customers.

Back 13

1. Merchandisers
2. Manufacturers

Front 14

What goes on the balance sheets form merchandisers and manufacturers?

Back 14

Slide 21 Week 1

Front 15

Know the Income Statement differences of merchandising companies and manufacturing companies.

Back 15

Slide 24 Week 1

Front 16

Calculates the cost of raw materials, direct labors, and manufacturing overhead used in production. Also calculates the manufacturing costs associated with goods that were finished during the period.

Back 16

Schedule of Cost of Goods Manufactured

Front 17

How do you calculate manufacturing costs?

Back 17

Direct materials + Direct Labor + Manufacturing overhead = Total Manufacturing costs

Front 18

How do you calculate work in progress?

Back 18

Beginning work in process inventroy + total manufacturing costs = Total work in process for the period.

Front 19

How do you calculate the cost of goods manufactured?

Back 19

Total work in process for the period - ending work in process inventory = Cost of goods manufactured

Front 20

Know how to calculate cost of goods sold.

Back 20

Slide 34 Week 1

Front 21

How does a cost react to changes in the level of business activity?

Back 21

1. Total variable costs change when activity changes.
- Example: Total texting bill (10 cents per message)

Variable Cost Per Unit
- Example: Cost per texts is constant (Texting plan such as unlimited)

2. Total fixed costs remain unchanged when activity changes.
- Example: Monthly contract fee remains fixed.

Fixed Cost per Unit
- Example: Calls made within the monthly plan decreases as more calls is made.

Front 22

Costs that can be easily and conveniently traced to a unit of product or other cost object.

Back 22

Direct Costs

- Example: Direct materials and direct labor.

Front 23

Costs that cannot be easily and conveniently traced to a unit of product or other cost object.

Back 23

Indirect Costs

- Example: Manufacturing overhead

Front 24

Difference in cost between any two alternatives.

Back 24

Differential costs (or incremental costs)

- Can either be fixed or variable.

Front 25

The potential benefit that is given up when one alternative is selected over another.

Back 25

Opportunity costs

Front 26

Cannot be changed by any decision. They are not differential costs and should be ignored when making decisions.

Back 26

Sunk Costs

- Example: Buying a car for $10,000 will not change the cost no matter what you do to it.

Front 27

What are the two types of product costing systems?

Back 27

1. Process Costing (One similar product)
- Example: Coke products

2. Job-order Costing (Unique products)
- Example: Boeing aircraft

Front 28

Why do we use allocation base?

Back 28

1. It is impossible to trace overhead costs to particular jobs.
2. Manufacturing overhead consists of many different items ranging from the grease used in machines to a production manager's salary.
3. Many types of manufacturing overhead costs are fixed even though output fluctuates during the period.

Front 29

What is the formula to find predetermined overhead rate (POHR)

Back 29

POHR = estimated total manufacturing overhead cost for the coming period / estimated total units in the allocation base for the coming period

Front 30

What is the formula for manufacturing overhead?

Back 30

POHR x Actual activity

Front 31

Total cost is found by adding what three things?

Back 31

1. Direct materials
2. Direct labor
3. Manufacturing overhead

Front 32

Exists when the amount of overhead applied to jobs during the period using the predetermined overhead rate is less than the total amount of overhead actually incurred during the period.

Back 32

Underapplied Overhead

Front 33

Exists when the amount of overhead applied to jobs during the period using the predetermined overhead rate is greater than the total amount of overhead actually incurred during the period.

Back 33

Overapplied Overhead

Front 34

A single overhead rate used throughout the entire factory.

Back 34

Plantwide Overhead Rate

Front 35

System in which each department has its own overhead rate.

Back 35

Department Overhead Rate

Front 36

An event that causes the consumption of overhead resources.

Back 36

Activity

Front 37

A "cost bucket" in which costs related to a particular activity are accumulated.

Back 37

Activity Cost Pool

Front 38

Expresses how much of the activity is carried out and is used as the allocation base for applying overhead costs.

Back 38

Activity Measure