Managerial vs. Financial Accounting: Cost Behavior and Decision Support Systems

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Finance - Personal Finance

georgepetenjk Created by 10 mon ago

Cards in this deck(50)

What is Managerial Accounting and how does it support internal planning decisions?

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What is Financial Accounting and what is its primary orientation?

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What happens to total variable costs when activity levels change?

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How do fixed costs behave in relation to changes in activity levels?

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What is the formula for calculating variable costs?

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Which of the following are considered typical variable costs?

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What are typical fixed costs in a business?

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As revenues increase, what happens to variable expenses and contribution margin?

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What does the term 'sales mix' refer to in a company's operations?

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What is the impact of a change in the sales mix on a company's financials?

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How do fixed expenses affect operating income as activity levels change?

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What does operating leverage measure in a business context?

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What does a higher contribution margin ratio indicate about a firm's operating leverage?

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What is the effect of high leverage on a company's income with a small percentage increase in revenue?

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In financial accounting, how is cost defined in relation to resources?

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In managerial accounting, when do costs become expenses?

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What is the value chain in a business context?

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What are direct costs and how are they related to products?

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What are indirect costs and how do they relate to product discontinuation?

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How is manufacturing overhead applied to each job?

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When is the predetermined overhead rate (POHR) determined?

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What is the formula for calculating the predetermined overhead rate (POHR)?

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How is overhead applied to actual activity using the POHR?

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What is job order costing and how are costs accumulated?

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How does process accounting differ from job order costing?

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What is Activity-Based Costing (ABC) and how does it assign overhead costs?

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What are most cost drivers related to in production?

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What are the three factors to consider when choosing a cost driver?

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What are the procedures involved in Activity-Based Costing (ABC)?

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What are relevant costs in decision-making?

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What are considered irrelevant costs in decision-making?

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How do differential costs vary in decision-making scenarios?

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What is opportunity cost in the context of decision-making?

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What is an allocated cost in accounting?

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What is a sunk cost and how does it affect decision-making?

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What should the decision to accept additional business be based on?

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What are incremental amounts in the context of new business decisions?

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In deciding how scarce resources are going to be utilized, what should be the focus?

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Why must the value of time money be recognized in business investments?

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What is the cost of capital usually regarded as in investment analysis?

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What does the cost of capital represent for a company?

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Which methods use present value analysis in investment appraisal?

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Which methods do not use present value analysis in investment appraisal?

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What does net present value (NPV) compare in investment analysis?

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What is the internal rate of return (IRR) in investment analysis?

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What does the payback period indicate in investment analysis?

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What does the accounting rate of return focus on in investment analysis?

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What is the formula for calculating the accounting rate of return?

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How is the average investment calculated in investment analysis?

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What is a flaw of the accounting rate of return in investment analysis?

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