Cpa, Bec, Planning, Control, Analysis

Front 1

BE Sales

Back 1

Sales = VC + FC + NI

Or FC / CM Margin ratio

Front 2

Target Net Income

Back 2

Required sales = VC + FC + NI

Front 3

BE unit

Back 3

Fixed cost / CM per unit

Front 4

Multiple Product Breakeven

Back 4

1. Add CM for each based on proportoin
2. FC / Total CM

Linear equation to solve for X

Front 5

Assumption underlying CVP

Back 5

1. Behavior for costs and revenue is linear
2. Cost can be accurately classified as eitehr fixed or variable
3. Changes in activity are the only factos that affect cost
4. All units produced are sold
5. sales mix remain constant
6. Selling price doesn't change with activity
7. Fixed costs are constant over relevent range
8. Productivity and efficiency are constant

Front 6

BE Operating Income approach

Back 6

Oprating income before tax = Sales revenue - VC - FC

Front 7

net income under VC costing vs absorbtion costing

Back 7

Sales = production, no impact on income

Sales > production, VC income is higher than absorbtion costing

Sales <Production VC income is less than AC

Front 8

Potential advantages of variable costing

Back 8

1. NI is not affected by production level
2. Consistent with CVP
3. NI closely tied to change in sales level
4. Easier to identify cost and their effect on business

Front 9

Margin of safety

Back 9

Actual sales - BE sales

Front 10

Financial Planning Process

Back 10

1. Analyze investment and financing alternative
2. Forecating future consequences of alternative
3. Deciding wihch alternative to undertake
4. Measuring subsequent performance against established goals

Front 11

Budget

Back 11

Is a formal written statement of mgmt's plan for a specified future time peirod, expressed in financial terms.

Budget must reflect mgmt's objectives and plans

Front 12

Types of budget

Back 12

Operating budget
Financial budget

Front 13

Function of Budget

Back 13

1. Coordinate various funtional activities
2. Provide for a basis for control of activities

Front 14

Production Budget

Back 14

Budgeted Sales
Plus desired ending inventory
= Total units needed
Less beginning inventory
= units to be purchased

Front 15

Direct Material Budget

Back 15

Production need in unit
+ desired endning inventory
= total need
- Beg DM inventory
= DM to be purchases
X Unit price
= DM $ needed

Front 16

Manufacturing CM

Back 16

Sales
Less V. Manufecturing cost
= Manufecturing CM

Front 17

Controllable Margin

Back 17

Sales
Less V. Manufecturing cost
= Manufecturing CM
- V Selling and admin cost
= Cont. Margin
- Controllable tracable fixed cost
= Controllable Contribution

Front 18

Delphi Technique of forecast

Back 18

Develops consensus among a group about the future through a series of structed questionnaries

Front 19

Types of Delphi technique

Back 19

1. Based on historical data
2. Based on observed application
3. Based on forecast of consumer behavior

Front 20

Approached based on historcial data - Delphi

Back 20

1. Naive models - historical
2. Moving average
3. Exponential smoothing
4. Decompositio of time series (good for seasonal cyclical)

Front 21

Approches based on observed association

Back 21

1. Regression analysis
2. Econometric models - Regression with economic data

Front 22

Approches based on consumer behavior

Back 22

Markov Technique - considers brand loyalty, brand switching behavior, predicts change in market share

Front 23

Cost Function

Back 23

Y = a +bx

Y = Dependent
a= constant
b= slope
X = independant

Front 24

Coefficient of determination / Goodness of fit

Back 24

Adjusted R square

the % of variablity in the dependant variable explained by an independant variable

Front 25

Coefficient of correlation

Back 25

Direction of move
can from from -1 to 1

0 = no relationship

Front 26

Price variance of material

Back 26

AQ X AP - AQ X SP

Front 27

Qantity Variance

Back 27

AQ X SP - SQ X SP

Front 28

Total Budget Variance

Back 28

AP X AQ - SP X SQ

Front 29

Rate variance

Back 29

AH X AR - AH X SR

Front 30

Efficiency variance

Back 30

AH X SR
SH X SR

Front 31

Fixed Production variance

Back 31

Budget based on capacity
- SQ X SR

Front 32

3 variance approach

Back 32

Combined:
VOH spending variance
FOH spending variance
then
VOH efficiency
Fixed production

Front 33

Basic elements of project

Back 33

1. Resources
2. Time
3. Money
4. Scope

Front 34

Process of project mgmt

Back 34

Project initiation
Project planning
Project execution
Project monitoring and control
Project closure

Front 35

PERT: Project evaluation and review technique

Back 35

Focuses on interdependencies and time required to complete an activity.
Looks at critical path and slack time

Front 36

Network diagram

Back 36

1. Illustrates interdependencies
2. Identifies critical path
3. Facilitates risk analysis
4. Enables mgmt to evaluate consequence of delay

Front 37

Types of transfer pricing

Back 37

1. Cost based price
2. Market based price
3. negotiated price