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accounting 9
accounting chapter 9 WGU C213
| Term | Definition |
|---|---|
| return on investment | measure of operating performance and efficiency in utilizing assets Net income / average total assets = ROA ( return on assessment) |
| long turn planning | strategic planning capital budgeting |
| short- run planning | production and process prioritizing operations budgeting (profit planning) |
| strategic planning | board, long-range planning usually conducted by top management |
| capital budgeting | systematic planning for long-term investment in operating assets |
| production prioritizing | managements continual evaluation of various product lines and divisions profitability in order to analyze and identify opportunities to imporve profits |
| operational budgeting | managerial planning decisions regarding current and immediate future ( a year or less) operations that are characterized by regularity and frequency |
| controling | implementing managerial plans and identifying how plans compare with actual performance |
| evaluating | analyzing results, rewarding performance and identifying problems |
| managerial accouning | unique competitive toll both financial and non financial data usually kept secret within the company used for internal planning, control and evalation |
| financial accounting | uniform across companies (usually GAAP) restricted to financial data data often made public used primary by investors and creditors |
| cost-volume-profit (C-V-P) analysis | techniques for determining how changes in revenues, costs and level of activity affect the profitability of an organization |
| variable costs | costs that change in total in direct proportion to changes in activity level |
| fixed costs | costs that remain constant in total, regardless of activity level, over a certain range of activity |
| product costs | costs associated with products or services offered |
| period costs | costs not directly related to a product, service or asset. they are charged as expenses to the income statement in the period in which they are incurred |
| manufacturing (product ) costs | direct materials direct labor manufacturing overhead |
| non-manufacturing (period) costs | selling expenses administrative expenses |
| direct materials | materials that become part of the product and are traceable to it |
| indirect materials | materials that are necessary to manufacturing or service business that are not directly included in or are not a significant part of the actual product |
| direct labor | wages paid to those who physically work on direct materials to transform them into a finished product and are traceable to specific product |
| indirect labor | labor that is necessary to a manufacturing or service business but is not directly related to the actual production of the product |
| manufacturing overhead | all costs incurred in the manufacturing process other than direct materials and direct labor |
| direct costs | costs that are specifically traceable toa unit of business or segment being analyzed |
| indirect costs | costs normally incurred for the benefit of several segments within the organization sometimes called common costs or joint costs |
| differential costs | future costs that change as a result of decision; incremental or relevant costs |
| sunk costs | costs that are past costs and do not change as a result of future decision |
| out-of-pocket costs | costs that require an outlay of cash or other resources |
| opportunity costs | the benefits lost of fortified as a result of selecting one alternative course of action over another |
Created by:
1piper4me
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