e成本与管理会计 第1-5章（双语教学使用）

ChapterOneManagerialAccountingandtheBusinessEnvironmentImportsintotheUnitedStates1990199520002004ExportsfromtheUnitedStates1990199520002004InternetUsageTheInternetfuelsglobalization

byprovidingcompanieswithgreater

accesstogeographicallydispersed

customers,employees,andsuppliers.Thenumberofinternetusersmore

thandoubledduringthefirstfour

yearsofthenewmillennium.StrategyAstrategy

isa“gameplan〞

thatenablesacompany

toattractcustomers

bydistinguishingitself

fromcompetitors.Thefocalpointofa

company’sstrategyshould

beitstargetcustomers.CustomerValuePropositionsUnderstandandrespondto

individualcustomerneeds.Customer

Intimacy

StrategyOperational

Excellence

StrategyDeliverproductsandservices

faster,moreconveniently,

andatlowerprices.Product

Leadership

StrategyOfferhigherqualityproducts.WorkofManagement

PlanningControllingDirectingand

MotivatingPlanningIdentify

alternatives.Selectalternativethatdoes

thebestjoboffurthering

organization’sobjectives.Developbudgetstoguide

progresstowardthe

selectedalternative.DirectingandMotivating

Directingandmotivatinginvolvesmanagingday-to-dayactivitiestokeeptheorganizationrunningsmoothly.Employeeworkassignments.Routineproblemsolving.Conflictresolution.Effectivecommunications.ControllingThecontrolfunctionensures

thatplansarebeingfollowed.Feedbackintheformofperformancereports

thatcompareactualresultswiththebudget

areanessentialpartofthecontrolfunction.PlanningandControlCycleDecision

MakingFormulatinglong-andshort-termplans(Planning)Measuring

performance(Controlling)Implementing

plans(DirectingandMotivating)Comparingactual

toplannedperformance(Controlling)BeginExhibit1-2LearningObjective1Identifythemajordifferencesandsimilaritiesbetweenfinancialandmanagerialaccounting.ComparisonofFinancialandManagerialAccountingLearningObjective2Understandtheroleofmanagementaccountantsinanorganization.OrganizationalStructureDecentralizationisthedelegationofdecision-makingauthoritythroughoutanorganization.LineandStaffRelationships

Linepositionsaredirectlyrelatedtoachievementofthebasicobjectivesofanorganization.Example:Productionsupervisorsinamanufacturingplant.

Staffpositionssupportandassistlinepositions.Example:Costaccountantsinthemanufacturingplant.TheChiefFinancialOfficer(CFO)

Amemberofthetopmanagementteamresponsiblefor:Providingtimelyandrelevantdatatosupportplanningandcontrolactivities.Preparingfinancialstatementsforexternalusers.LearningObjective3UnderstandthebasicconceptsunderlyingLeanProduction,theTheoryofConstraints,andSixSigma.ProcessManagementBusinessfunctionsmakingupthevaluechain

ProductCustomerR&DDesignManufacturingMarketingDistributionServiceAbusiness

processisaseriesof

stepsthatarefollowedinorderto

carryoutsometaskin

abusiness.ProcessManagementTherearethreeapproachesto

improvingbusinessprocesses...Lean

ProductionTheoryof

Constraints(TOC)Six

SigmaTraditional“Push〞

ManufacturingCompanyForecastSalesOrdercomponentsProducegoodsinAnticipationofSalesMakeSalesfromFinishedGoodsInventoryStoreInventoryStore

InventoryTraditional“push〞

manufacturingTraditional“Push〞

ManufacturingCompanyLarge

inventoriesFinished

goodsRaw

materialsWorkin

processMaterialswaiting

tobeprocessed.Completedproductsawaitingsale.Partiallycompletedproductsrequiringmoreworkbeforetheyarereadyforsale.LeanProductionExhibit1-6Theleanthinking

modelisafive

stepapproach.Identifyvalue

inspecific

products/services.Identifythe

businessprocess

thatdeliversvalue.Organizework

arrangementsaround

theflowofthe

businessprocess.Createapull

systemthatresponds

tocustomerorders.Continuouslypursue

perfectioninthe

businessprocess.CustomerPlacesanOrderCreateProductionOrderGenerateComponentRequirementsProductionBeginsasPartsArriveGoodsDeliveredwhenneededComponentsareOrderedLeanProductionThefivestepprocessresultsina“pull〞manufacturingsystem

thatreducesinventories,decreasesdefects,reduces

wastedeffort,andshortenscustomerresponsetimes.LeanProductionLeanthinkingmaybeusedtoimprovebusinessprocessesthatlinkcompaniestogether.

Thetermsupplychainmanagementreferstothecoordinationofbusinessprocessesacrosscompaniestobetterserveendconsumers.

Aconstraint

(alsocalledabottleneck)isanythingthatpreventsyoufromgettingmoreofwhatyouwant.TheTheoryofConstraintsisbasedontheobservationthateffectivelymanagingtheconstraintisthekeytosuccess.Theconstraintinasystemisdetermined

bythestepthathasthe

smallestcapacity.TheoryofConstraints4.Recognizethattheweakestlink

isnolongerso.1.Identifytheweakestlink.2.Allowtheweakestlinktosetthetempo.3.Focusonimprovingtheweakestlink.Onlyactionsthatstrengthentheweakestlinkinthe“chain〞improvetheprocess.TheoryofConstraintsSixSigmaAprocessimprovementmethodrelyingoncustomerfeedbackandfact-baseddatagatheringandanalysistechniquestodriveprocessimprovement.Referstoaprocessthatgeneratesnomore

than3.4defectspermillionopportunities.Sometimesassociated

withthetermzerodefects.SixSigmaExhibit1-8E-CommerceE-commercereferstobusiness

conductedusingtheInternet.Inadditiontodotcompanies,traditional

businesses,suchasbanksandretailers,

continuetoexpandtheirInternetpresence.Thegrowthine-commerceisoccurring

becausetheInternethasimportantadvantages

overmoreconventionalmarketplacesformany

kindsoftransactions.EnterpriseSystemsAsinglesoftwaresystemthat

integratesdataacrossanorganization,therebyenablingallemployeestohavesimultaneousaccesstoa

commonsetofdata.Alldataarerecordedonly

onceinthecompany’s

centralizeddatabase.Theuniquedataelements

containedwithinadatabase

canbelinkedtogether.LearningObjective4Understandtheimportanceofupholdingethicalstandards.CodeofConductfor

ManagementAccountants

TheInstituteofManagementAccountant’s(IMA)StandardsofEthicalConductforPractitioners

ofManagementAccountingandFinancialManagementhavetwomajorparts,whichofferguidelinesfor: Ethicalbehavior. Resolutionforanethicalconflict.CompetenceFollowapplicable

laws,regulations

andstandards.Maintainprofessionalcompetence.Provideaccurate,clear,concise,andtimelydecisionsupportinformation.IMAGuidelinesforEthicalBehaviorRecognizeandcommunicateprofessionallimitationsthatprecluderesponsiblejudgment.ConfidentialityDonotdiscloseconfidentialinformationunlesslegallyobligatedtodoso.Ensurethatsubordinatesdonotdiscloseconfidentialinformation.Donotuseconfidentialinformationforunethicalorillegal

advantage.IMAGuidelinesforEthicalBehaviorMitigateconflictsofinterestandadviseothersofpotentialconflicts.Abstainfromactivitiesthatmightdiscredittheprofession.Refrainfromconductthatwouldprejudicecarryingoutdutiesethically.IntegrityIMAGuidelinesforEthicalBehaviorCommunicateinformationfairlyandobjectively.Discloseallrelevantinformationthatcouldinfluenceauser’sunderstandingofreports

andrecommendations.CredibilityIMAGuidelinesforEthicalBehaviorDisclosedelaysordeficienciesininformationtimeliness,processing,orinternalcontrols.Followemployer’sestablishedpolicies.Forunresolvedethicalconflicts:Discusstheconflictwithimmediatesupervisorornexthighestuninvolvedmanager.IfimmediatesupervisoristheCEO,considertheboardofdirectorsortheauditcommittee.Contactwithlevelsabovetheimmediatesupervisorshouldonlybeinitiatedwiththesupervisor’sknowledge,assumingthesupervisorisnotinvolved.IMAGuidelinesforResolution

ofanEthicalConflictFollowemployer’sestablishedpolicies.Forunresolvedethicalconflicts:Exceptwherelegallyprescribed,maintainconfidentiality.Clarifyissuesinaconfidentialdiscussionwithanobjectiveadvisor.Consultanattorneyastolegalobligations.IMAGuidelinesforResolution

ofanEthicalConflictAbandoningethicalstandardsinbusinesswould

leadtoalowerqualityoflifewithless

desirablegoodsandservicesathigherprices.WhyHaveEthicalStandards?Withoutethicalstandardsinbusiness,the

economy,andallofuswhodependonitfor

jobs,goods,andservices,wouldsuffer.Ethicalstandardsinbusinessareessentialfora

smoothfunctioningadvancedmarketeconomy.CompanyCodesofConductEmployeesCustomersSuppliersAndtothecommunitiesin

whichthecompanyoperates.Broad-basedstatementsofa

company’sresponsibilitiesto:CodesofConducton

theInternationalLevelInadditiontocompetence,objectivity,independence,

andconfidentiality,theIFAC’scodedealswith

theaccountant’sethicalresponsibilitiesin:TaxesIndependenceFeesandcommissionsAdvertisingandsolicitationHandlingofmoniesCross-borderactivities.TheCodeofEthicsforProfessional

Accountants,issuedbytheInternational

FederationofAccountants(IFAC),governthe

activitiesofprofessionalaccountantsworldwide.CorporateGovernanceThesystemby

whichacompanyisdirected

andcontrolled.Boardof

DirectorsTop

ManagementStockholdersTopursue

objectivesofIncentivesand

monitoringforCorporateGovernanceAndthecommunitiesin

whichthecompanyoperates.Aneffectivecorporategovernancesystem

shouldalsoprotecttheinterestsofthe

company’sotherstakeholders.EmployeesCustomersSuppliersCreditorsTheSarbanes-OxleyActof2002TheSarbanes-OxleyActof2002wasintendedtoprotectthe

interestsofthosewhoinvestinpubliclytradedcompaniesby

improvingthereliabilityandaccuracyofcorporatefinancial

reportsanddisclosures.Sixkeyaspectsofthelegislationinclude:

TheActrequiresboththeCEOandCFOtocertifyinwriting

thattheircompany’sfinancialstatementsanddisclosures

fairlyrepresenttheresultsofoperations.TheActestablishesthePublicCompanyAccountingOversight

Boardtoprovideadditionaloversightoftheauditprofession.TheActplacesthepowertohire,compensateandterminate

publicaccountingfirmsinthehandsoftheauditcommittee.TheActplacesrestrictionsonauditfirms,suchasprohibiting

publicaccountingfirmsfromprovidingavarietyofnon-audit

servicestoanauditclient.TheSarbanes-OxleyActof2002TheActrequiresthatacompany’sannualreportcontainan

internalcontrolreportthatisaccompaniedbyanopinionfrom

thecompany’sauditfirmaboutthefairnessofthatreport.TheActestablishesseverepenaltiesforcertainbehaviors,

suchas:Upto20yearsinprisonforalteringordestroyingany

documentsthatmayeventuallybeusedinanofficial

proceeding.Upto10yearsinprisonforretaliatingagainsta

“whistleblower.〞

EnterpriseRiskManagementAprocessused

byacompanyto

proactivelyidentify

andmanagerisk.Onceacompanyidentifiesitsrisks,perhapsthe

mostcommonriskmanagementtacticistoreduce

risksbyimplementingspecificcontrols.ShouldItrytoavoidtherisk,sharetherisk,acceptthe

risk,orreducetherisk?EnterpriseRiskManagementCertifiedManagementAccountantAmanagementaccountant

whohasthenecessaryqualificationsand

whopassesarigorousprofessionalexamearns

therighttobeknownasaCertified

ManagementAccountant(CMA).InformationaboutbecomingaCMAandtheCMA

programcanbeaccessedontheIMA’swebsiteat

orbycalling1-800-638-4427.EndofChapter1CostTerms,ConceptsandClassificationsChapterTwoLearningObjective1Identifyandgiveexamplesofeachofthethreebasicmanufacturingcostcategories.TheProductDirect

MaterialsDirect

LaborManufacturing

OverheadManufacturingCostsDirectMaterials

Rawmaterialsthatbecomeanintegralpartoftheproductandthatcanbeconvenientlytraceddirectlytoit.Example:

AradioinstalledinanautomobileDirectLaborThoselaborcoststhatcanbeeasilytracedtoindividualunitsofproduct.Example:

WagespaidtoautomobileassemblyworkersManufacturingcoststhatcannotbetraceddirectlytospecificunitsproduced.ManufacturingOverheadExamples:

IndirectlaborandindirectmaterialsWagespaidtoemployeeswhoarenotdirectlyinvolvedinproductionwork.

Examples:maintenanceworkers,janitorsandsecurityguards.Materialsusedtosupporttheproductionprocess.

Examples:lubricantsandcleaningsuppliesusedintheautomobileassemblyplant.Non-manufacturingCostsSelling

CostsCostsnecessarytogettheorderanddelivertheproduct.AdministrativeCostsAllexecutive,organizational,andclericalcosts.LearningObjective2Distinguishbetweenproductcostsandperiodcostsandgiveexamplesofeach.ProductCostsVersusPeriodCosts

Productcostsincludedirectmaterials,directlabor,andmanufacturingoverhead.Periodcostsincludeallsellingcostsandadministrativecosts.

InventoryCostofGoodSoldBalance

SheetIncome

StatementSaleExpenseIncome

StatementQuickCheck

Whichofthefollowingcostswouldbeconsideredaperiodratherthanaproductcostinamanufacturingcompany?A.Manufacturingequipmentdepreciation.B.Propertytaxesoncorporateheadquarters.C.Directmaterialscosts.D.Electricalcoststolighttheproductionfacility.E.Salescommissions.QuickCheck

Whichofthefollowingcostswouldbeconsideredaperiodratherthanaproductcostinamanufacturingcompany?A.Manufacturingequipmentdepreciation.B.Propertytaxesoncorporateheadquarters.C.Directmaterialscosts.D.Electricalcoststolighttheproductionfacility.E.Salescommissions.ClassificationsofCostsDirect

MaterialDirect

LaborManufacturing

OverheadPrime

CostConversion

CostManufacturingcostsareoften

classifiedasfollows:ComparingMerchandisingandManufacturingActivitiesMerchandisers...Buyfinishedgoods.Sellfinishedgoods.Manufacturers...Buyrawmaterials.Produceandsellfinishedgoods.MegaLoMartBalanceSheet

Merchandiser

CurrentassetsCashReceivablesPrepaidExpensesMerchandiseInventory

Manufacturer

CurrentAssetsCashReceivablesPrepaidExpensesInventoriesRawMaterialsWorkinProcessFinishedGoods

Merchandiser

CurrentassetsCashReceivablesPrepaidExpensesMerchandiseInventory

Manufacturer

CurrentAssetsCashReceivablesPrepaidExpensesInventoriesRawMaterialsWorkinProcessFinishedGoodsBalanceSheetPartiallycompleteproducts–somematerial,labor,oroverheadhasbeenadded.Completedproductsawaitingsale.Materialswaitingtobeprocessed.LearningObjective3Prepareanincomestatementincludingcalculationofthecostofgoodssold.TheIncomeStatement

Costofgoodssoldformanufacturersdiffersonlyslightlyfromcostofgoodssoldformerchandisers.

BasicEquationforInventoryAccounts BeginningbalanceAdditions

toinventory+=EndingbalanceWithdrawals

frominventory+QuickCheck

Ifyourinventorybalanceatthebeginningofthemonthwas$1,000,youbought$100duringthemonth,andsold$300duringthemonth,whatwouldbethebalanceattheendofthemonth?A.$1,000.B.$800.C.$1,200.D.$200.QuickCheck

Ifyourinventorybalanceatthebeginningofthemonthwas$1,000,youbought$100duringthemonth,andsold$300duringthemonth,whatwouldbethebalanceattheendofthemonth?A.$1,000.B.$800.C.$1,200.D.$200.$1,000+$100=$1,100$1,100-$300=$800LearningObjective4Prepareascheduleofcostofgoodsmanufactured.ScheduleofCostofGoodsManufacturedCalculatesthecostofrawmaterial,directlaborandmanufacturingoverheadusedinproduction.Calculatesthemanufacturingcostsassociatedwithgoodsthatwerefinishedduringtheperiod.Asitemsareremovedfromrawmaterialsinventoryandplacedintotheproductionprocess,theyare

calleddirectmaterials.ProductCostFlowsConversioncostsarecostsincurredtoconvertthedirectmaterialintoafinishedproduct.ProductCostFlowsProductCostFlowsAllmanufacturingcostsincurredduringtheperiodareaddedtothebeginningbalanceofworkinprocess.ProductCostFlowsCostsassociatedwiththegoodsthatarecompletedduringtheperiodaretransferredtofinishedgoodsinventory.ProductCostFlowsManufacturingCostFlowsFinished

GoodsCostof

Goods

SoldSellingand

AdministrativePeriodCostsSellingand

AdministrativeManufacturing

Overhead

Workin

ProcessDirectLabor

BalanceSheet

CostsInventories Income

Statement

ExpensesMaterialPurchasesRawMaterialsQuickCheck

Beginningrawmaterialsinventorywas$32,000.Duringthemonth,$276,000ofrawmaterialwaspurchased.Acountattheendofthemonthrevealedthat$28,000ofrawmaterialwasstillpresent.Whatisthecostofdirectmaterialused?A. $276,000B. $272,000C. $280,000D. $2,000

QuickCheck

Beginningrawmaterialsinventorywas$32,000.Duringthemonth,$276,000ofrawmaterialwaspurchased.Acountattheendofthemonthrevealedthat$28,000ofrawmaterialwasstillpresent.Whatisthecostofdirectmaterialused?A. $276,000B. $272,000C. $280,000D. $2,000

QuickCheck

Directmaterialsusedinproductiontotaled$280,000.Directlaborwas$375,000andfactoryoverheadwas$180,000.Whatweretotalmanufacturingcostsincurredforthemonth?A. $555,000B. $835,000C. $655,000D. Cannotbedetermined.

Directmaterialsusedinproductiontotaled$280,000.Directlaborwas$375,000andfactoryoverheadwas$180,000.Whatweretotalmanufacturingcostsincurredforthemonth?A. $555,000B. $835,000C. $655,000D. Cannotbedetermined.QuickCheckQuickCheck

Beginningworkinprocesswas$125,000.Manufacturingcostsincurredforthemonthwere$835,000.Therewere$200,000ofpartiallyfinishedgoodsremaininginworkinprocessinventoryattheendofthemonth.Whatwasthecostofgoodsmanufacturedduringthemonth?A. $1,160,000B. $910,000C. $760,000D. Cannotbedetermined.

Beginningworkinprocesswas$125,000.Manufacturingcostsincurredforthemonthwere$835,000.Therewere$200,000ofpartiallyfinishedgoodsremaininginworkinprocessinventoryattheendofthemonth.Whatwasthecostofgoodsmanufacturedduringthemonth?A. $1,160,000B. $910,000C. $760,000D. Cannotbedetermined.QuickCheckQuickCheck

Beginningfinishedgoodsinventorywas$130,000.Thecostofgoodsmanufacturedforthemonthwas$760,000.Andtheendingfinishedgoodsinventorywas$150,000.Whatwasthecostofgoodssoldforthemonth?A.$20,000.B.$740,000.C.$780,000.D.$760,000.QuickCheck

Beginningfinishedgoodsinventorywas$130,000.Thecostofgoodsmanufacturedforthemonthwas$760,000.Andtheendingfinishedgoodsinventorywas$150,000.Whatwasthecostofgoodssoldforthemonth?A.$20,000.B.$740,000.C.$780,000.D.$760,000.$130,000+$760,000=$890,000$890,000-$150,000=$740,000LearningObjective5Understandthedifferencesbetweenvariablecostsandfixedcosts.CostClassificationsforPredictingCostBehavior

Howacostwillreacttochangesinthelevelofactivitywithintherelevantrange.Totalvariablecosts

changewhenactivitychanges.Totalfixedcosts

remainunchangedwhenactivitychanges.VariableCost

Yourtotallongdistancetelephonebillisbasedonhowmanyminutesyoutalk.MinutesTalkedTotalLongDistance

TelephoneBillVariableCostPerUnitMinutesTalkedPerMinute

TelephoneCharge

Thecostperlongdistanceminutetalkedisconstant.Forexample,10centsperminute.FixedCost

Yourmonthlybasictelephonebillprobablydoesnotchangewhenyoumakemorelocalcalls.NumberofLocalCallsMonthlyBasicTelephoneBillFixedCostPerUnitNumberofLocalCallsMonthlyBasicTelephoneBillperLocalCallTheaveragefixedcostperlocalcalldecreasesasmorelocalcallsaremade.CostClassificationsforPredictingCostBehaviorQuickCheck

WhichofthefollowingcostswouldbevariablewithrespecttothenumberofconessoldataBaskins&Robbinsshop?(Theremaybemorethanonecorrectanswer.)A.Thecostoflightingthestore.B.Thewagesofthestoremanager.C.Thecostoficecream.D.Thecostofnapkinsforcustomers.QuickCheck

WhichofthefollowingcostswouldbevariablewithrespecttothenumberofconessoldataBaskins&Robbinsshop?(Theremaybemorethanonecorrectanswer.)A.Thecostoflightingthestore.B.Thewagesofthestoremanager.C.Thecostoficecream.D.Thecostofnapkinsforcustomers.LearningObjective6Understandthedifferencesbetweendirectandindirectcosts.AssigningCoststoCostObjectsDirectcostsCoststhatcanbe

easilyandconvenientlytracedtoaunitofproductorothercostobject.Examples:directmaterialanddirectlaborIndirectcostsCoststhatcannotbeeasilyandconvenientlytracedtoaunitofproductorothercostobject.Example:manufacturingoverheadLearningObjective7Defineandgiveexamplesofcostclassificationsusedinmakingdecisions:differentialcosts,opportunitycosts,andsunkcosts.Everydecisioninvolvesachoicebetweenatleasttwoalternatives.

Onlythosecostsandbenefitsthatdifferbetweenalternativesarerelevantinadecision.Allothercostsandbenefitscanandshouldbeignored.CostClassificationsforDecisionMakingDifferentialCostandRevenueCostsandrevenuesthatdifferamongalternatives.Example:Youhaveajobpaying$1,500permonthinyourhometown.Youhaveajobofferinaneighboringcitythatpays$2,000permonth.Thecommutingcosttothecityis$300permonth.Differentialrevenueis:

$2,000–$1,500=$500Differentialcostis:

$300OpportunityCost

Thepotentialbenefitthatisgivenupwhenonealternativeisselectedoveranother.

Example:Ifyouwere

notattendingcollege,

youcouldbeearning

$15,000peryear.

Youropportunitycost

ofattendingcollegeforoneyearis$15,000.SunkCosts

Sunkcostshavealreadybeenincurredandcannotbechangednoworinthefuture.Theyshouldbeignoredwhenmakingdecisions.

Example:

Youboughtanautomobilethatcost$10,000twoyearsago.The$10,000costissunkbecausewhetheryoudriveit,parkit,tradeit,orsellit,youcannotchangethe$10,000cost.QuickCheck

SupposeyouaretryingtodecidewhethertodriveortakethetraintoPortlandtoattendaconcert.Youhaveamplecashtodoeither,butyoudon’twanttowastemoneyneedlessly.Isthecostofthetrainticketrelevantinthisdecision?Inotherwords,shouldthecostofthetrainticketaffectthedecisionofwhetheryoudriveortakethetraintoPortland?A.Yes,thecostofthetrainticketisrelevant.B.No,thecostofthetrainticketisnotrelevant.QuickCheck

SupposeyouaretryingtodecidewhethertodriveortakethetraintoPortlandtoattendaconcert.Youhaveamplecashtodoeither,butyoudon’twanttowastemoneyneedlessly.Isthecostofthetrainticketrelevantinthisdecision?Inotherwords,shouldthecostofthetrainticketaffectthedecisionofwhetheryoudriveortakethetraintoPortland?A.Yes,thecostofthetrainticketisrelevant.B.No,thecostofthetrainticketisnotrelevant.QuickCheck

SupposeyouaretryingtodecidewhethertodriveortakethetraintoPortlandtoattendaconcert.Youhaveamplecashtodoeither,butyoudon’twanttowastemoneyneedlessly.Istheannualcostoflicensingyourcarrelevantinthisdecision?A.Yes,thelicensingcostisrelevant.B.No,thelicensingcostisnotrelevant.QuickCheck

SupposeyouaretryingtodecidewhethertodriveortakethetraintoPortlandtoattendaconcert.Youhaveamplecashtodoeither,butyoudon’twanttowastemoneyneedlessly.Istheannualcostoflicensingyourcarrelevantinthisdecision?A.Yes,thelicensingcostisrelevant.B.No,thelicensingcostisnotrelevant.QuickCheck

Supposethatyourcarcouldbesoldnowfor$5,000.Isthisasunkcost?A.Yes,itisasunkcost.B.No,itisnotasunkcost.QuickCheck

Supposethatyourcarcouldbesoldnowfor$5,000.Isthisasunkcost?A.Yes,itisasunkcost.B.No,itisnotasunkcost.SummaryoftheTypesofCostClassificationsFinancialreportingPredictingcostbehaviorAssigningcoststocostobjectsDecisionmakingFurtherClassificationofLaborCostsAppendix2ALearningObjective8(Appendix2A)Properlyaccountforlaborcostsassociatedwithidletime,overtime,andfringebenefits.IdleTimeThelaborcostsincurredduringidletimeareordinarilytreatedasmanufacturingoverhead.MachineBreakdownsMaterialShortagesPowerFailuresOvertimeTheovertimepremiumsforallfactoryworkersareusuallyconsideredtobepartofmanufacturingoverhead.LaborFringeBenefitsFringebenefitsincludeemployerpaidcostsforinsuranceprograms,retirementplans,supplementalunemploymentprograms,SocialSecurity,Medicare,workers’compensationandunemploymenttaxes.Somecompaniesincludeallofthesecostsinmanufacturingoverhead.Othercompaniestreatfringebenefitexpensesofdirectlaborersasadditionaldirectlaborcosts.CostofQualityAppendix2BLearningObjective9(Appendix2B)Identifythefourtypesofqualitycostsandexplainhowtheyinteract.QualityofConformanceWhentheoverwhelmingmajorityofproductsproducedconformtodesignspecificationsandarefreefromdefects.PreventionandAppraisalCostsPreventionCostsSupportactivitieswhosepurposeistoreducethenumberofdefectsAppraisalCostsIncurredtoidentifydefectiveproductsbeforetheproductsareshippedInternalandExternalFailureCostsInternalFailureCostsIncurredasaresultofidentifyingdefectsbeforetheyareshippedExternalFailureCostsIncurredasaresultofdefectiveproductsbeingdeliveredtocustomersExamplesofQualityCostsPreventionCosts