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FINAL Exam Review

by: Anya Khegay

FINAL Exam Review ACC 212

Anya Khegay
GPA 3.54
Managerial Accounting
Mario Perez

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Awesome, very neat and organized study guide for Managerial Accounting! With formulas and all definitions, and examples of types of short answer problems that will be on the exam! Got an A in the c...
Managerial Accounting
Mario Perez
Study Guide
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This 6 page Study Guide was uploaded by Anya Khegay on Wednesday April 8, 2015. The Study Guide belongs to ACC 212 at University of Miami taught by Mario Perez in Spring 2015. Since its upload, it has received 149 views. For similar materials see Managerial Accounting in Accounting at University of Miami.


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Date Created: 04/08/15
ACC212 FINAL REVIEW 6 PROBLEMS 1 Journal EnTries CH2 a COGSManufacTured eTc 2 Process CosTing CH3 a Of eauivalenT uniTs eTc b DM i0 Conversion 20 eTc 3 2 problems NPV IRR Paybacllt period ARR CH8 4 Cash ReceipT Schedule CH9 a WhaT is collecTed This monTh from sales on accounT 5 DirecT MaTerials Purchases BudgeT CH9 a Desired invenTory eTc 85 MC Questions ChapTeri 1 Financial vs Managerial Accounting a ExTernal vs lnTernal users i ExTernal Those Than do noT work for The company ex sToclltholders banks suppliers cusTomers compeTiTors eTc ii lnTernal Those ThaT work for The company employees ex marllteTing managers salespersons sTraTegic planners company presidenT eTc b AccounTing rules i Financial accounTing info musT be conformed wiTh GAAP or IFRS ii Managerial accounTing is NOT required To be conformed To any rules c Level of deTail i Financial accounTing deals wiTh The company as a whole conTain very liTTle deTail ii ManagemenT accounTing info is designed To address specific issues and Therefore much more deTailed d Timeliness i Financial accounTing sTaTemenTs are presenTed auarTerly ii Managerial accounTing informaTion is needed To made freauenT decisions Therefore if is presenTed much more ofTen e OrienTaTion i Financial accounTing presenTs hisTorical resulTs ii Managerial accounTing has a forward looking orienTaTion ChapTer 2 1 ProducT vs Period cosT a ProducT CosT vs Period CosT i ProducT cosT The cosT of various producTs ThaT a company sells ex cosT of a book for BampN lnvenTorial cosTs ii Period CosT all cosTs incurred by a company ThaT are noT considered producT cosTs lncludes selling and adminisTraTive cosT Ex cosT of employees in accounTing finance markeTing and cerTain execuTives 1 Selling cosT The cosT of locoTing cusTomers dTTrdcTing cusTomers convincing cusTomers To buy dnd The cosT of necessary paperwork To documenT dnd record soles ex soldries pdid To The soles force soles commissions dnd ddverTising 2 AdminisTroTive cosT dll cosTs incurred by d compdny ThoT ore noT producT cosTs or selling cosTs Includes The cosT of dccounTing findnce employee reldTions dnd execuTive funcTions iii The disTincTion beTween producT cosT dnd period cosT is bdsed on wedTher The cosT in quesTion benefiTs The process of geTTing producT reddy for sole producT cosT or The selling dnd ddminisTrdTive funcTions period cosTs 2 DirecT vs lndirecT COST or DirecT cosT d cosT ThoT con be edsin Trdced To on individuol cosT objecT ex sTore mdndger soldry b lndirecT cosTs d cosT ThoT supporTs more Thdn one cosT objecT common cosT ex region mdndger soldry 3 3 Types of invenTory 1 Row deeridls invenTory deeridls ThoT hove been purchdsed buT hove noT yeT enTered The producTion process deeridl sTores ex sheeT merl poinT eTc 2 WIP invenTory producTs ThoT hove enTered The producTion process buT hove noT yeT been compleTed ex desllts filling cobineTs eTc ThoT ore noT finished yeT 3 Finished goods invenTory producTs ThoT hove been compleTed dnd ore reddy To sell ex pieces compleTed buT noT yeT sold 4 COGSManufacfured 0 COST of goods sold schedule i Beginning lnvenTory Jon 1 2008 Purchdses during 2008 Goods Avoildble for Sole in 2008 Ending lnvenTory Dec 31 2008 CosT of Goods Sold for 2008 b CosT of Goods Manufacfured Schedule DirecT deeridls Beginning DirecT deeridls invenTory Jon 1 2008 Purchdses during 2008 MdTeridls Avoildble during 2008 Ending DirecT MdTeridls lnvenTory Dec 31 2008 DirecT MdTeridls Used during 2008 DirecT Ldbor during 2008 MonufdcTuring Overhedd CosT lndirecT Ldbor CosT lndirecT MdTeridls CosT OTher cosTs Tonl MonufdcTuring CosT for currenT Period Beginning WIP lnvenTory Jon 12008 CosT of Gods Avoildble To be Finished in 2008 Ending WIP invenTory Dec 31 2008 CosT of Good MonufdcTured during 2008 c CosT of Goods Sold Schedule Beginning finished goods invenTory Jon 1 2008 CosT of goods monufdcTured during 2008 Goods Avoildble for Sole in 2008 Finished goods invenTory Dec 31 2008 COGS for 2008 ChapTer 3 1 Allocate overhead using Traditional approach CALCULATE o TradiTional Approach of AllocaTion ManufacTuring Overhead i EsTimaTe manufacTuring overhead in The beginning of The year 2 AllocaTe manufacTuring overhead using one of The following cosT drivers a DirecT labor hours b DirecT labor cosT c Machine hours 3 CalculaTe a predeTermined allocaTion raTe aT The beginning of The year a ToTal esTimaTed overhead ToTal esTimaTed cosT of a cosT driver AllocaTion raTe 2 Job order cosTing vs Process cosTing THEORY Cl b Job order cosTing a cosTing meThod ThaT accumulaTes cosT by a single uniT or producTion of baTch of uniTs Process cosTing a meThod of allocaTion manufacTuring cosT To producTs To deTermine an average cosT per uniT 3 Of equivalenT uniTs CALCULATE a The of eauivalenT uniTs of producTion ChapTer 4 1 ABC vs 0 EauivalenT uniTs The TheoreTical number of uniTs ThaT would have been compleTed if all producTion efforTs resulTed inly in compleTed uniTs o of equivalenT uniTs on uniTs compIeTed WIP compIeTed o The uniTs To be accounTed for comes from The beginning WIP uniTs sTarTed during The period TradiTional Approach THEORY DirecT maTerials and DirecT labor are easily Traceable ManufacTuring overhead indirecT labor indirecT maTerials and manufacTuring overhead 9 you have To allocaTe iT using TradiTional approach or ABC 0 TradiTional Approach of AllocaTion ManufacTuring Overhead O 4 EsTimaTe manufacTuring overhead in The beginning of The year 5 AllocaTe manufacTuring overhead using one of The following cosT drivers a DirecT labor hours b DirecT labor cosT c Machine hours 6 CalculaTe a predeTermined allocaTion raTe aT The beginning of The year a ToTal esTimaTed overhead ToTal esTimaTed cosT of a cosT driver AllocaTion raTe ABC AcTiviTy Based CosTing Same as TradiTional approach buT you make allocaTion raTed for every cosT driver 9 you have many allocaTion raTes 9 apply all of Them To every job you need To cosT ChapTer 5 1 Variable vs Fixed vs Mixed cosT THEORY a Variable CosT Remain The same per uniT regardless of acTiviTy As acTiviTy goes UP m variable cosT goes UP Ex hourly wages b Fixed CosT Remains The same in ToTal regardless of acTiviTy As acTiviTy goes UP The fixed cosT per uniT goes DOWN Fixed cosTs remain The same in ToTal wiThin The relevanT period Ex RenT c Mixed CosT A cosT ThaT is boTh variable and fixed Y A BX 0 Y ToTa COST 0 A fixed COST 0 B variable cosT Ex UTiliTies basic cosT variable Salesman salary fixed commission 2 4 MeThods of spliTTing cosTs THEORY a Engineering approach The company hires an experT To spliT The cosT beTween fixed and variable 9 easiesT b ScaTTer graph Manually poT hisTorical daTa info a graph To deTermine The ToTa cosT equaTion c Regression analysis Use sofTware To poT hisTorical daTa 9 mosT accuraTe d High Low meThod Use The period wiTh The highesT acTiviTy and The period wiT The lowesT acTiviTy To calculaTe The cosT equaTion 3 HighLow MeThod CALCULATE How To calculaTe i STep i SelecT The period wiTh The lowesT acTiviTy and The highesT acTiviTy 2 STep 2 Solve for variable cosT per uniT a CosT The high CosT The lowAcTiviTy The high AcTiviTy The low per uniT 3 STep 3 Solve for fixed cosT a CosT The high A sTep 2AcTiviTy The high 4 STep 4 Solve for The ToTal cosT equaTion a Y A BX ChapTer 6 1 TradiTional vs ConTribuTion income sTaTemenT a TradiTional income sTaTemenT an income sTaTemenT prepared in The muTipe sTep or single sTep income sTaTemenT formaT ThaT conforms To GAAP and can be used for exTernal financial reporTing b Contribution income statement an income statement that classifies cost by behavior fixed cost vs variable cost i Contribution Income Statement 1 Sales Revenue 2 Less Variable Expenses a Contribution lvlargin 3 Less Fixed Expenses a Net Income Net Loss 2 Breakeven and target profit in units and in SS CALCULATE a Break even in units i Contribution approach Fixed Expenses Contribution lvlargin per Unit 1 Contribution margin per unit Selling price Variable per unit ii Eauation approach Sales Variable Fixed Profit b Break even in sales i Contribution approach Fixed Expenses Contribution lvlargin Ratio 1 Contribution margin ratio Selling price Variable per unit Sales ii Eauation approach Sales Variable Fixed Profit c Target Profit i Required sales in Total fixed Target Contribution lvlargin Ratio ii Required sales in units Total fixed cost Target Contribution lvlargin per Unit Chapter 7 1 Relevant vs Notrelevant information THERORY a Relevant information information that is pertinent to a particular decision in that it has a bearing on which decision alternative is preferable b Relevant cost a cash or cash outflow that is pertinent to a particular business decision i The cost must be something that will happen in the future ii The cost must differ between decision alternatives c Sunllt cost a past cost that cannot be changed by current or future actions 2 Keep or Replace CALCULATE a Step 1 Gather all costs and benefits associated with the decision b Step 2 Determine the relevant cost and benefit of each alternative c Step 3 Compare the relevant information and select an alternative 3 Make or Buy CALCULATE a Step 1 Gather all costs associated with the decision b Step 2 Determine the relevant cost of each alternative c Step 3 Compare the relevant cost and benefits and select an alternative 4 Special Order CALCULATE a Special orders an order that is outside a company s normal scope or business activity Sales from special order 0 Less Direct material 0 Less Direct labor 0 Less Variable manufacturing overhead 9 Total relevant production Total increase from sale 40 8 are on the following ChOlOTGFS Chagter 8 1 Capital budgeting 2 Cost of capital 3 NPV IRR Payback ARR CALCULATE Chagter 9 1 Approaches to Budgeting THEORY 10 0 Ex Incremental zero based etc 2 Production budgeting CALCULATE 3 3 Cash Receipt Schedule CALCULATE 5 Chagter i0 1 Standard budgeted 2 Variance 4 2 for materials usage price and 2 for labor rate etticiency 15 3 Meaning of each variance THEORY Chagter i i 1 Centralized vs Decentralized management 2 ROI CALCILATE 3 Residual Income CALCUATE


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