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19 Cards in this Set

  • Front
  • Back
Relevant Information
The predicted future costs and revenues that will differ among alternative courses of action
Decision Model
Any method for making a choice, sometimes requiring elaborate quantitative procedures
Avoidable Costs
Costs that will not continue if an ongoing operaion is changed or deleted
Unavoidable Costs
Costs that continue even if a company discontinues an operation
Common Costs
These costs of facilities and services that are shared by users
Limiting Factor (Scarce Resource)
The item that restricts or constrains the production or sale of a product or service
Inventory Turnover
The number of times the average inventory is sold per year
Perfect Competition
A market in which a firm can sell as much of a product as it can produce, all at a single market price
Marginal Cost

(aka Variable Cost)
The additional cost resulting from producing and selling one additional unit
Marginal Revenue
The additional revenue resulting from the sale of an additional unity
Imperfect Competition
A market in which the price a firm charges for a unit will influence the quantity of units it sells
Price Elasticity
The effect of price changes on sales volume
Predatory Pricing
Establishing prices so low that they drive competitors out of the market. The predatory pricer then has no significant competition and can raise prices cramatically
Discriminatory Pricing
Charging different prices to different customers for the same product or service
The amount by which price exceeds cost
Full Cost (Fully Allocate Cost)
The total of all manufacturing costs pluse the total of all selling and administrative costs
Target Costing
A cost management tool for making cost reduction a key focus throughout the life of a product; based on desired cost
Value Engineering
A cost-reduction technique, used primarily during design, that uses informaiton about all value chain functions to satisfy customer needs while reducing costs
Kaizen Costing
The Japanese term for continuous improvement during manufacturing