Managerial Accounting Chapter 8

Front 1

action analysis report

Back 1

a report showing what costs have been assigned to a cost object, such as a product or customer, and how difficult it would be to adjust the cost if there is a change in activity.

Front 2

activity

Back 2

an event that causes the consumption of overhead resources in an organization.

Front 3

activity-based costing (ABC)

Back 3

a costing method based on activities that is designed to provide managers with cost information for strategic and other decisions that potentially affect capacity and therefore fixed as well as variable costs.

Front 4

activity-based management (ABM)

Back 4

a management approach that focuses on managing activities as well as a way of eliminating waste and reducing delays and defects.

Front 5

activity cost pool

Back 5

a "bucket" in which costs are accumulated that relate to a single activity measure in an activity-based costing system.

Front 6

activity measure

Back 6

an allocation base in an activity-based costing system; ideally, a measure of the amount of activity that drives the costs in an activity cost pool.

Front 7

batch-level activities

Back 7

activities that are performed each time a batch of goods is handled or processed, regardless of how many units are in the batch. the amount of resource consumed depends on the number of batches run rather than on the number of units in the batch.

Front 8

customer-level activities

Back 8

activities that are carried out to support customers but that are not related to any specific product.

Front 9

duration driver

Back 9

a measure of the amount of time required to perform an activity.

Front 10

first-stage allocation

Back 10

the process by which overhead costs are assigned to activity cost pools in an activity-based costing system.

Front 11

organization-sustaining activities

Back 11

activities that are carried out regardless of which customers are served, which products are produced, how many batches are run, or how many units are made.

Front 12

product-level activities

Back 12

activities that relate to specific products that must be carried out regardless of how many units are produced and sold or batches run.

Front 13

second-stage allocation

Back 13

the process by which activity rates are used to apply costs to products and customers in activity-based costing.

Front 14

transaction driver

Back 14

a simple count of the number of times an activity occurs.

Front 15

unit-level activities

Back 15

activities that are performed each time a unit is produced.