Chap 16 Flashcards

Miller, Financial and Managerial Accounting 5e http://media.pearsoncmg.com/ph/bp/bp_horngren_fm_5/student/flas...
Budget Controlling
A financial plan that managers use to Implementing plans and evaluating the
coordinate a business's activities. results of business operations by
comparing the actual results to the budget.
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Planning Cost/Benefit Analysis
Choosing goals and deciding how to Weighing costs against benefits to help
achieve them. make decisions.
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Management Accountability Stakeholder
The manager's responsibility to wisely An individual or group that has an interest

manage the resources of an organization. in a business, including customers,
creditors, suppliers, and investors.
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Enterprise Resource Planning Just-In-Time (JIT) Management

(ERP)
Software system that can integrate all of a A cost management system in which a
company's functions, departments, and company produces products just in time to
data into a single system. satisfy needs. Suppliers deliver materials
just in time to begin production, and
finished units are completed just in time
for delivery to the customer.
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Total Quality Management Triple Bottom Line

(TQM)
A philosophy designed to integrate all Evaluating a company's performance by its

organizational areas in order to provide economic (profits), social (people), and
customers with superior products and environmental (planet) impact.
services, while meeting organizational
goals throughout the value chain.
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Value Chain Period Cost
Includes all activities that add value to a Operating cost that is expensed in the
company's products and services. accounting period in which it is incurred.
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Service Company Merchandising Company
A company that sells services--time, skills, A company that resells products previously
and/or knowledge--instead of products. bought from suppliers.
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Product Cost Finished Goods Inventory (FG)
The cost of purchasing or making a Completed goods that have not yet been
product. The cost is recorded as an asset sold.
and then expensed when the product is
sold.
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Manufacturing Company Raw Materials Inventory (RM)
A company that uses labor, equipment, Materials used to manufacture a product.

supplies, and facilities to convert raw
materials into finished products.
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Work-in-Process Inventory Cost Object

(WIP)
Goods that have been started in the Anything for which managers want a
manufacturing process but are not yet separate measurement of cost.
complete.
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Direct Cost Indirect Cost
Cost that can be easily and cost-effectively Cost that cannot be easily or
traced to a cost object. cost-effectively traced to a cost object.
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Conversion Costs Direct Labor (DL)
The cost to convert raw materials into The labor cost of employees who convert
finished goods: Direct labor plus raw materials into finished products.
manufacturing overhead.
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Direct Materials (DM) Indirect Labor
Materials that become a physical part of a Labor costs for activities that support the
finished product and whose costs are easily production process but either cannot be
traced to the finished product. conveniently traced directly to specific
finished products or are not large enough
to justify tracing to the specific product.
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Indirect Materials Manufacturing Overhead (MOH)
Materials used in making a product but Manufacturing costs that cannot be easily
whose costs either cannot be conveniently and cost-effectively traced to a cost object.
traced directly to specific finished products Includes all manufacturing costs except
or are not large enough to justify tracing to direct materials and direct labor.
the specific product.
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Prime Costs Cost of Goods Manufactured
Direct materials plus direct labor. The manufacturing costs of the goods that
finished the production process in a given
accounting period.
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Chap 16 Flashcards

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Miller, Financial and Managerial Accounting 5e http://media.pearsoncmg.com/ph/bp/bp_horngren_fm_5/student/flas...

Planning Cost/Benefit Analysis

Management Accountability Stakeholder

The manager's responsibility to wisely An individual or group that has an interest

Enterprise Resource Planning Just-In-Time (JIT) Management

Total Quality Management Triple Bottom Line

A philosophy designed to integrate all Evaluating a company's performance by its

Value Chain Period Cost

Service Company Merchandising Company

Product Cost Finished Goods Inventory (FG)

Manufacturing Company Raw Materials Inventory (RM)

A company that uses labor, equipment, Materials used to manufacture a product.

Work-in-Process Inventory Cost Object

Direct Cost Indirect Cost

Conversion Costs Direct Labor (DL)

Direct Materials (DM) Indirect Labor

Indirect Materials Manufacturing Overhead (MOH)

Prime Costs Cost of Goods Manufactured

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