Managerial Accounting 2

Front 1

Administrative Costs

Back 1

All executive, organizational, and clerical costs associated with the general management of an organization rather than with manufacturing or selling.

Front 2

Budget

Back 2

A detailed plan for the future, usually expressed in formal quantitative terms.

Front 3

Common Cost

Back 3

A cost that is incurred to support a number of cost objects but that cannot be traced to them individually.

Front 4

Control

Back 4

The process of instituting procedures and then obtaining feedback to ensure that all parts of the organization are functioning effectively and moving toward overall company goals.

Front 5

Controlling

Back 5

Actions taken to help ensure that the plan is being followed and is appropriately modified as circumstances change.

Front 6

Conversion Cost

Back 6

Direct labor cost plus manufacturing overhead cost.

Front 7

Cost Behavior

Back 7

The way in which a cost reacts to changes in the level of activity.

Front 8

Cost Object

Back 8

Anything for which cost data are desired. Examples of cost objects are products, customers, jobs, and parts of the organization such as departments or divisions.

Front 9

Cost of goods manufactured

Back 9

The manufacturing costs associated with the goods that were finished during the period.

Front 10

Differential Cost

Back 10

A difference in cost between two alternatives.

Front 11

Differential Revenue

Back 11

The difference in revenue between two alternatives.

Front 12

Direct Cost

Back 12

A cost that can be easily an conveniently traced to a specified cost object.

Front 13

Directing and Motivating

Back 13

Mobilizing people to carry out plans and run routine operations.

Front 14

Direct Labor

Back 14

Factory labor costs that can be easily traced to individual units of product.

Front 15

Direct Materials

Back 15

Materials that become an integral part of a finished product and whose costs can be conveniently traced to it.

Front 16

Feedback

Back 16

Accounting and other reports that help managers monitor performance and focus on problems and/or opportunities that might other wise go unnoticed.

Front 17

Financial Accounting

Back 17

The phase of accounting concerned with providing information to stock-holders, creditors, and others outside the organization.

Front 18

Finished Goods

Back 18

Units of product that have been completed but not yet sold to customers.

Front 19

Fixed Cost

Back 19

A cost that remains constant, in total, regardless of changes in the level of activity within the relevant range.

Front 20

Incremental Cost

Back 20

An increase in cost between two alternatives.

Front 21

Indirect Cost

Back 21

A cost that cannot be easily and conveniently traced to a specified cost object.

Front 22

Indirect Labor

Back 22

The labor costs of janitors, supervisors, materials handlers, and other factory workers that cannot be conveniently traced to particular products.

Front 23

Indirect Materials

Back 23

Small items of material such as glue and nails that may be an integral part of a finished product, but whose costs cannot be easily or conveniently traced to it.

Front 24

Managerial Accounting

Back 24

The phase of accounting concerned with providing information to managers for use within the organization.

Front 25

Opportunity Cost

Back 25

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

Front 26

Performance Report

Back 26

A detailed report comparing budgeted data to actual data.

Front 27

Period Costs

Back 27

Costs that are taken directly to the income statement as expenses in the period in which they are incurred or accrued.

Front 28

Planning

Back 28

Selecting a course of action and specifying how the action will be implemented.

Front 29

Planning and Control Cycle

Back 29

The flow of management activities through planning, directing and motivating, and controlling, and then back to planning again.

Front 30

Prime Cost

Back 30

Direct materials cost plus direct labor cost.

Front 31

Prime Cost

Back 31

Direct materials cost plus direct labor cost.

Front 32

Product Costs

Back 32

All costs that are involved in acquiring or making a product.

Front 33

Raw Materials

Back 33

Any materials that go into the final product.

Front 34

Relevant Range

Back 34

The range of activity within which assumptions about variable and fixed cost behavior are valid.

Front 35

Schedule of cost of goods manufactured

Back 35

A schedule showing the direct materials, direct labor, and manufacturing overhead costs incurred during a period and the portion of those costs that are assigned to Work in Process and Finished Goods.

Front 36

Segment

Back 36

Any part of an organization that can be evaluated independently of other parts and about which the manager seeks financial data.

Front 37

Selling Costs

Back 37

All costs that are incurred to secure customer orders and get the finished product or service into the hands of the customer.

Front 38

Sunk Cost

Back 38

A cost that has already been incurred and that cannot be changed by any decision made now or in the future.

Front 39

Variable Cost

Back 39

A cost that varies, in total, in direct proportion to changes in the level of activity. A variable cost is constant per unit.

Front 40

Work in Process

Back 40

Units of product that are only partially complete.