Chapter 1 & 2

The primary users of cost accounting are the investors, whereas the primary users of financial accounting are the managers.

Cost accounting deals with product design, production, and marketing strategies, whereas financial accounting deals mainly with pricing of the products.

Cost accounting measures only the financial information related to the costs of acquiring fixed assets in an organization, whereas financial accounting measures financial and nonfinancial information of a company's business transactions.

Cost accounting measures information related to the costs of acquiring or using resources in an organization, whereas financial accounting measures a financial position of a company to investors, banks, and external parties.

competence, performance, diligence, and reporting

competence, confidentiality, integrity, and credibility

experience, diligence, reporting, and objectivity

diligence, objectivity, conflicts of interest, and credibility

Maintain an appropriate level of professional expertise by continually developing knowledge and skills.

Keep information confidential except when disclosure is authorized or legally required.

Perform professional duties in accordance with relevant laws, regulations, and technical standards.

Provide decision support information and recommendations that are accurate, clear, concise, and timely.

accumulating and then assigning costs

accumulating costs

assigning and then accumulating costs

assigning costs

the assignment of direct costs to the chosen cost object

a function of cost allocation

the process of tracking both direct and indirect costs associated with a cost object

the process of determining the actual cost of the cost object

material used to make the soccer balls

labor to shape the leather used to make the soccer ball

material used to manufacture the soccer studs

salary paid to plant supervisor

Customer-service costs of a multiproduct firm; Product A is the cost object.

Printing costs incurred for payroll check processing; payroll check processing is the cost object.

The salary of a maintenance supervisor in a multiproduct manufacturing plant; Product B is the cost object.

Utility costs of the administrative offices; the accounting department is the cost object.

total fixed costs and total variable costs will change

total fixed costs and total variable costs will remain the same

total fixed costs will remain the same and total variable costs will change

total fixed costs will change and total variable costs will remain the same

sales costs

incoming freight costs

distribution costs

outgoing freight costs

product cost

prime cost

conversion cost

period cost

salary of the plant supervisor

labor that can be traced to individual products

material that can be traced to individual products

overtime premiums paid to plant workers

monthly rent payment

manager's salary

monthly electric bill

direct materials