Exam II Study Guide

Exam II Study Guide - Accounting Exam II Study Guide...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Accounting Exam II Study Guide 13/03/2007 19:00:00 1. An understanding of the different ways costs are classified for management  decision: Direct vs. Indirect Cost o Direct: Cost that can be traced to a cost objective without arbitrary  allocation o Indirect: Cost that requires allocation to trace a cost objective (i.e.  Insurance, rent expense, depreciation, etc.) Fixed vs. Variable Cost o Fixed: A cost that doesn’t change  in total as the level of activity  changes (i.e. Rent expense) o Variable: A cost whose total changes  proportionally to changes in  activity (i.e. Labor) o Mixed: A cost with characteristics of both fixed and variable (i.e. Parts  that have a volume discount for bulk purchases) Controllable vs. Non-controllable o Controllable: Cost that a specific manager has decision-making  authority over o Non-controllable: A cost that a specific manager has no decision-
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

Exam II Study Guide - Accounting Exam II Study Guide...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online