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Supplemental Terms and Concepts Chap 6, 7, 8, 9, & 21 plus KWK Chap 7 (1)

Supplemental Terms and Concepts Chap 6, 7, 8, 9, & 21 plus KWK Chap 7 (1)

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Accounting 320 Supplemental Terms and Concepts for Final Exam (HDR Chapters 6 through 9, 21, KWK Chap 7 and Financial Calculator) Static budget versus Flexible budget Static budget – P lanning (static) budget based on projected activity Flexible budget – Planning (static) budget updated for actual activity Responsibility Accounting – allocating accounting information to those people who are accountable for controlling it Controllable versus Non-controllable costs – ability of the manager to influence the specified cost Benchmarking : continuous process of comparing the company’s results to the best levels of performance outside the company e.g. a competitor or and an industry standard Variances: Be able to calculate the eight DM, DL, VOH, and FOH variances using the standard cost template a) rate or price variances – what was paid b) efficiency or budget variances – what was used c) volume variance – a. calculation variance – applies fixed costs as if they were variable costs b. reflects the difference between the standard activity base achieved and the standard activity based used in calculating the predetermined fixed overhead rate d) variances - compares actual to standard or budgeted e)
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