ACC 405 COST MANAGEMENT & CONTROL
__________ = Cost − Salvage Value / Life in Number of Periods
DEPRECIATION = Cost − Salvage Value / Life in Number of Periods
_____ _____ per unit vary as activities changes.
FIXED COST per unit vary as activities changes.
High Low method only uses ____ data points.
High Low method only uses TWO data points.
The formula for this relationship is: Y = a + bx Y = Total cost a = Total fixed cost b = Variable cost per unit of activity x = Number of units of activity
TOTAL COST= TOTAL FIXED COST + (VARIABLE COST PER UNIT OF ACTIVITIES x NUMBER OF UNITS OF ACTIVITY)
The _____ ______ __ ______ is approximated by a straight line.
The RELEVANT RANGE OF ACTIVITY is approximated by a straight line.
The equation for a straight-line can be used to express the relationship between _____ _____ and ____ ____ __ ________.
The equation for a straight-line can be used to express the relationship between MIXED costs and THE LEVEL OF ACTIVITIES.
The ________ _______ is based on the rise-over-run formula for the slope of a straight line.
The high-low method is based on the rise-over-run formula for the slope of a straight line.
the revenue obtained from selling one additional unit of product is called ________ revenue.
the revenue obtained from selling one additional unit of product is called MARGINAL revenue.
variable cost remain constant ______ ____ and vary in ______.
variable cost remain constant PER UNIT and vary in TOTAL
A ______ _____ is type of indirect cost incurred to benefit more than one cost object.
A COMMON COST is type of indirect cost incurred to benefit more than one cost object.
__________ _______ _____ _________ is an income statement in which all variable expenses are deducted from sales to arrive at a contribution margin, from which all fixed expenses are then subtracted to arrive at the net profit or loss for the period.
A CONTRIBUTION MARGIN INCOME STATEMENT is an income statement in which all variable expenses are deducted from sales to arrive at a contribution margin, from which all fixed expenses are then subtracted to arrive at the net profit or loss for the period.
A ________ can can be easily and conveniently traced to a specific cost objects.
A DIRECT COST can can be easily and conveniently traced to a specific cost objects.
A _______ ______ is a cost that contains both a fixed component and a variable component.
A MIXED COST is a cost that contains both a fixed component and a variable component.
A ______ ______ is any cost that cannot be capitalized into prepaid expenses, inventory, or fixed assets. A period cost is more closely associated with the passage of time than with a transactional event.
A PERIOD COST is any cost that cannot be capitalized into prepaid expenses, inventory, or fixed assets. A period cost is more closely associated with the passage of time than with a transactional event.
A _____ _____ is charged to expense in the period incurred. This type of cost is not included within the cost of goods sold on the income statement.
A PERIOD COST is charged to expense in the period incurred. This type of cost is not included within the cost of goods sold on the income statement.
A ____ _______ is a cost that an entity has incurred, and which it can no longer recover by any means.
A SUNK COSTis a cost that an entity has incurred, and which it can no longer recover by any means.
A contribution margin income statement can assist with _________ _______ _______ and it separate costs into their ______ and _______ components.
A contribution margin income statement can assist with MANAGEMENT DECISION MAKING and it separate costs into their FIXED COST and VARIABLE components.
A difference in revenue between any two alternatives is known as ________ ____________.
A difference in revenue between any two alternatives is known as DIFFERENTIAL REVENUE.
A mixed cost has a minimum cost of having a service available and ready for use. this is the ______ portion of a _______ cost.
A mixed cost has a minimum cost of having a service available and ready for use. this is the FIXED portion of a MIXED cost.
A regional sales manager's salary would be a __________ of the regional office in which the sales manager works.
A regional sales manager's salary would be a DIRECT COST of the regional office in which the sales manager works.
Advertising and sales commissions are________ _________.
Advertising and sales commissions are PERIOD COSTS.
______ ______ become an important component of the finished products and their cost can be easily and conveniently traced to the finished products.
DIRECT MATERIALS become an important component of the finished products and their cost can be easily and conveniently traced to the finished products.
Factory materials, such as cleaning supplies, that are NOT components of finished products are classified as: __________ __________
Factory materials, such as cleaning supplies, that are NOT components of finished products are classified as: MANUFACTURING OVERHEAD
Fixed cost per unit become progressively _______ as the level of activity increases. Because the same total cost spread over more unit.
Fixed cost per unit become progressively LARGER as the level of activity increases. Because the same total cost spread over more unit.
Fixed cost remain constant in ______ within the relevant range of activity. Fixed cost generally include ____ and __________ ____________.
Fixed cost remain constant in TOTAL within the relevant range of activity. Fixed cost generally include RENT and SUPERVISOR SALARIES.
______ _______ should not be expressed on a per unit basis in internal report.
Fixed cost should not be expressed on a per unit basis in internal report.
Fixed costs remain constant in _______ over the ______ range of activity.
Fixed costs remain constant in TOTAL over the RELEVANT range of activity.
________ ________ should be used if a scattergraph a linear relationship between cost and activity.
HIGH-LOW METHOD method should be used if a scattergraph a linear relationship between cost and activity.
High-Low method is one of the several techniques used to split a _____ cost into its fixed and variable components
High-Low method is one of the several techniques used to split a MIXED cost into its fixed and variable components
_______ _______ include: Assembly line supervisor salary, Factory security guard wages.
INDIRECT LABOR include: Assembly line supervisor salary, Factory security guard wages.
Indirect labor includes __________ costs only.
Indirect labor includes manufacturing costs only. salaries are non-manufacturing costs.
Indirect materials include: _____,_____,and______.
Indirect materials include: nails, glue, and thread
_______ cost may increase as activity levels increase.
MIXED cost may increase as activity levels increase.
______ costs contain both FIXED and VARIABLE COST elements.
MIXED costs contain both FIXED and VARIABLE COST elements.
Manufacturing costs include:
Manufacturing costs include: Direct labor, indirect labor, Direct materials.
_______ ______ is the cost of one additional unit of output.
Marginal cost is the cost of one additional unit of output.
Mixed costs are also commonly known as___________ costs.
Mixed costs are also commonly known as semi-variable costs.
________ ______ is a potential benefit given up by choosing one alternatives over another.
Opportunity Cost: is a potential benefit given up by choosing one alternatives over another.
______ _______ is typically included within the selling and administrative expenses section of the income statement.
PERIOD COST is typically included within the selling and administrative expenses section of the income statement.
______ cost are expensed when incurred, and ______ cost become part of inventory on the balance sheet
PERIOD costs are expensed when incurred, and PRODUCT cost become part of inventory on the balance sheet
Period costs are expensed on the ______ _________: in the period in which they occur.
Period costs are expensed on the INCOME STATEMENT: in the period in which they occur.
Product cost is the cost of: ______ ,_______, _________, and _________that are used to create a product.
Product cost is the cost of direct labor, direct materials, consumable production supplies, and manufacturing overhead that are used to create a product.
STEP COST is the cost increase with volume in steps; also called __________ _____.
STEP COST is the cost increase with volume in steps; also called SEMIFIXED COST.
Salaries of factory supervisors and factory maintenance personnel are example of ________ cost.
Salaries of factory supervisors and factory maintenance personnel are example of INDIRECT cost.
Sales revenue - variable expense = __________
Sales revenue - variable expense = CONTRIBUTION MARGIN
Since a period cost is essentially always charged to expense at once, it may more appropriately be called a _______ ___________.
Since a period cost is essentially always charged to expense at once, it may more appropriately be called a PERIOD EXPENSE.
The relative proportion of each type of cost in an organization is known as its _______ __________.
The relative proportion of each type of cost in an organization is known as its COST STRUCTURE.
The variable portion of a mixed cost represents the____ ______ for the ________ ________ __ _ ________.
The variable portion of a mixed cost represents the COST INCURRED for the ACTUAL CONSUMPTION OF A SERVICE.
There are two broad classification of costs: manufacturing cost and ________________ _____.
There are two broad classification of costs: manufacturing cost and NON-MANUFACTURING COST.
When mixed costs are represented by a straight-line, the steeper the slope, the higher the ____________
When mixed costs are represented by a straight-line, the steeper the slope, the higher the variable cost per unit.
When the level of usage of a mixed cost item increases, the _____ component of the cost will not change, while the _______ component will increase.
When the level of usage of a mixed cost item increases, the FIXED component of the cost will not change, while the VARIABLE component will increase.
Within the ______ ______ of activity, cost assumptions are reasonably valid.
Within the RELEVANT RANGE of activity, cost assumptions are reasonably valid.
Within the relevant range of activities, variable costs are; vary in _____, remain constant ________.
Within the relevant range of activities, variable costs are; vary in TOTAL, remain constant PER UNIT.
Within the relevant range of activity, _____ ______ remain constant in total.
Within the relevant range of activity, FIXED COST remain constant in total.
