STANDARD COSTS AND
Standards are benchmarks or norms for
measuring performance. In managerial accounting,
two types of standards are commonly used.
specify how much of an
DECENTRALIZATION, AND THE
Keys to Segmented Income
There are two keys to building
segmented income statements:
A contribution format should be used because it
separates fixed from variable cost
SEGMENT REPORTING EXAMPLE
Mary Fischer, the owner of Marys Market, would like information concerning the
performance of the Markets two main segmentsthe meat and produce departments.
RELEVANT COSTS FOR
Identifying Relevant Costs
An avoidable cost is a cost that can be
eliminated, in whole or in part, by choosing
one alternative over another. Avoidable
costs are relevant costs. Unavoidable costs
Typical Capital Budgeting Decisions
Capital budgeting tends to fall into two broad
categories . . .
Screening decisions. Does a proposed project
meet some preset standard of acceptance?
Preference decisions. Select