Accounting 2242-assignment 1 solution

Accounting 2242-assignment 1 solution - Accounting 2242.1...

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Accounting 2242.1 Assignment 1- Solution Due date: May 16, 2006 Question 1-Definitions Provide definitions for the following: Managerial Accounting – The phase of accounting concerned with providing information to managers for use in planning and controlling operations and in decision making. Financial Accounting – The phase of accounting concerned with providing information to shareholders, creditors and others outside the organization. Budget – A detailed plan for the future, usually expressed in formal quantitative terms. Just-in-time Inventory – A production and inventory control system in which materials are purchased and units are produced only as needed to meet actual customer demand. Theory of constraints – A management approach that emphasizes the importance of managing constraints. Conversion costs – Direct labour cost plus manufacturing overhead cost. Prime costs – Direct materials cost plus direct labour cost. Variable costs – A cost that varies, in total, in direct proportion to changes in the level of activity. A variable cost is constant per unit. Fixed costs – A cost that remains constant, in total, regardless of changes in the level of activity within the relevant range. If a fixed cost is expressed on a per unit basis, it varies inversely with the level of activity. Opportunity costs – The potential benefit that is given up when one alternative is selected over another.
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Problem 1 You have recently been hired by a manufacturing company. Two days ago, you met with the top management of the company to discuss future strategies for the firm. During the meeting, the president of the company expressed concern about the profitability of the company and the company’s ability to compete effectively in the future. You responded to the president’s concerns by mentioning some articles you had read in professional accounting journals
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Accounting 2242-assignment 1 solution - Accounting 2242.1...

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