2023年-管理会计专业术语词汇大全英文版

管理会计专业术语词汇AAbsorptioncostingAproduct-costingmethodthatassignsallmanufacturingcoststoaproduct:directmaterials,directlabor,variableoverhead,andfixedoverhead.Absorption-costing(full-costing)incomeIncomecomputedusingafunctionally-basedstatement.Costofgoodssoldincludesallvariablemanufacturingcostsandaportionoffixedfactoryoverhead.AccountingrateofreturnTherateofreturnobtainedbydividingtheaverageaccountingnetincomebytheoriginalinvestment(orbyaverageinvestment).ActivityAbasicunitofworkperformedwithinanorganization.Italsocanbedefinedasanaggregationofactionswithinanorganizationusefultomanagersforpurposesofplanning,controlling,anddecisionmaking.ActivityanalysisTheprocessofidentifying,describing,andevaluatingtheactivitiesanorganizationperforms.ActivityattributesNonfinancialandfinancialinformationitemsthatdescribeindividualactivities.ActivitybudgetingTheprocessofestimatingthedemandforeachactivity'soutputandassessingthecostofresourcesrequiredtoproducethisoutput.ActivitycapacityThenumberoftimesanactivitycanbeperformed.ActivitydictionaryAlistofactivitiesdescribedbyspecificattributessuchasname,definition,classificationasprimaryorsecondary,andactivitydriver.ActivitydriversFactorsthatmeasuretheconsumptionofactivitiesbyproductsDiscountfactorThefactorusedtoconvertafuturecashflowtoitspresentvalue.DiscountrateTherateofreturnusedtocomputethepresentvalueoffuturecashflows.DiscountedcashflowsFuturecashflowsexpressedinpresent-valueterms.DiscountingTheactoffindingthepresentvalueoffuturecashflows.DiscountingmodelsCapitalinvestmentmodelsthatexplicitlyconsiderthetimevalueofmoneyinidentifyingcriteriaforacceptingorrejectingproposedprojects.DiscretionaryfixedexpensesExpensesincurredfortheacquisitionofshorttermcapacityorservices,usuallyastheresultofyearlyplanning.Double-loopfeedbackInformationaboutboththeeffectivenessofstrategyimplementationandthevalidityofassumptionsunderlyingthestrategy.DriveranalysisTheeffortexpendedtoidentifythosefactorsthataretherootcausesofactivitycosts,economic,andtranslationexposureduetoexchangeratefluctuations.CurrentlyattainablestandardsStandardsthatreflectanefficientoperatingstate;theyarerigorousbutachievable.CustomerperspectiveAbalancedscorecardviewpointthatdefinesthecustomerandmarketsegmentsinwhichthebusinesswillcompete.CustomervalueRealizationlesssacrifice,whererealizationiswhatthecustomerreceivesandsacrificeiswhatisgivenup.CycletimeThelengthoftimerequiredtoproduceoneunitofaproduct.DDecentralizationThegrantingofdecision-makingfreedomtoloweroperatinglevels.DecentralizeddecisionmakingAsysteminwhichdecisionsaremadeandimplementedbylower-levelmanagers.DecisionmakingTheprocessofchoosingamongcompetingalternatives.DecisionmodelAspecificsetofproceduresthat,whenfollowed,producesadecision.DecisionpackageAdescriptionofservicelevels,withassociatedcosts,thatadecisionunitcanorwouldliketooffer.DefectiveproductAproductorservicethatdoesnotconformtospecifications.Degreeofoperatingleverage(DOL)Ameasureofthesensitivityofprofitchangestochangesinsalesvolume.Itmeasuresthepercentagechangeinprofitsresultingfromapercentagechangeinsales.DependentvariableAvariablewhosevaluedependsonthevalueofanothervariable.Forexample,YinthecostformulaY_F_VXdependsonthevalueofX.DirectcostsCoststhatcanbeeasilyandaccuratelytracedtoacostobject.DirectfixedexpensesFixedcoststhataredirectlytraceabletoagivenseg-•85168183_glossary_849-860.qxd1/22/042:27PMPage851DrivertracingTheuseofdriverstoassigncoststocostobjects.DriversFactorsthatcausechangesinresourceusage,activityusage,costs,andrevenues.Drum-Buffer-Rope(DBR)SystemTheTOCinventorymanagementsystemthatreliesonthedrumbeatofthemajorconstrainedresources,timebuffers,andropestodetermineinventorylevels.DumpingPredatorypricingintheinternationalmarket.DurabilityThelengthoftimeaproductfunctions.DysfunctionalbehaviorIndividualbehaviorthatconflictswiththegoalsoftheorganization.EEcoefficiencyAviewofenvironmentalmanagementmaintainingthatorganizationscanproducemoreusefulgoodsandserviceswhilesimultaneouslyreducingnegativeenvironmentalimpacts,resourceconsumption,andcosts.Economicorderquantity(EOQ)Theamountthatshouldbeordered(orproduced)tominimizethetotalordering(orsetup)andcarryingcosts.EconomicriskThepossibilitythatafirm'spresentvalueoffuturecashflowscanbeaffectedbyexchangefluctuations.Economicvalueadded(EVA)Aperformancemeasurethatiscalculatedbytakingtheafter-taxoperatingprofitminusthetotalannualcostofcapital.ElectronicbusinessAnybusinesstransactionorinformationexchangethatisexecutedusinginformationandcommunicationtechnology.Electroniccommerce(e-commerce)Buyingandsellingproductsusinginformationandcommunicationtechnology.Electronicdatainterchange(EDI)Aninventorymanagementmethodthatallowssuppliersaccesstoabuyer'son-linedatabase.ExternalfailurecostsCostsincurredbecauseproductsfailtoconformtorequirementsafterbeingsoldtooutsideparties.ExternallinkagesTherelationshipofafirm'sactivitieswithinitssegmentofthevaluechainwiththoseactivitiesofitssuppliersandcustomers.ExternalmeasuresMeasuresthatrelatetocustomerandshareholderobjectives.FFacility-levelactivitiesActivitiesthatsustainafacility'sgeneralmanufacturingprocess.FailureactivitiesActivitiesperformedbyanorganizationoritscustomersinresponsetopoorquality(poorqualitydoesexist).FailurecostsThecostsincurredbyanorganizationbecausefailureactivitiesareperformed.Favorable(F)variancesVariancesproducedwhenevertheactualamountsarelessthanthebudgetedorstandardallowances.FeasiblesetofsolutionsThecollectionofallfeasiblesolutions.FeasiblesolutionAproductmixthatsatisfiesallconstraints.Features(qualityofdesign)Characteristicsofaproductthatdifferentiatefunctionallysimilarproducts.FeedbackInformationthatcanbeusedtoevaluateorcorrectthestepsbeingtakentoimplementaplan.FIFOcostingmethodAprocesscostingmethodthatseparatesunitsinbeginninginventoryfromthoseproducedduringthecurrentperiod.Unitcostsincludeonlycurrentperiodcostsandproduction.FinancialaccountinginformationsystemAnaccountinginformationsubsystemthatisprimarilyconcernedwithproducingoutputsforexternalusersanduseswell-specifiedeconomiceventsasinputsandprocessesthatmeetcertainrulesandconventions.FinancialbudgetsTheportionsofthemasterbudgetthatincludethecashEmployeeempowermentTheauthorizationofoperationalpersonneltoplan,control,andmakedecisionswithoutexplicitauthorizationfrommiddleandhigher-levelmanagement.EndingfinishedgoodsinventorybudgetAbudgetthatdescribesplannedendinginventoryoffinishedgoodsinunitsanddollars.EnvironmentalcostsCoststhatareincurredbecausepoorenvironmentalqualityexistsormayexist.EnvironmentaldetectioncostsCostsincurredtodetectpoorenvironmentalperformance.EnvironmentalexternalfailurecostsCostsincurredaftercontaminantsareintroducedintotheenvironment.EnvironmentalinternalfailurecostsCostsincurredaftercontaminantsareproducedbutbeforetheyareintroducedintotheenvironment.EnvironmentalpreventioncostsCostsincurredtopreventdamagetotheenvironment.EquivalentunitsofoutputCompleteunitsthatcouldhavebeenproducedgiventhetotalamountofmanufacturingeffortexpendedduringtheperiod.EthicalbehaviorChoosingactionsthatare"right,“"properJand“just."Ourbehaviorcanberightorwrong,itcanbeproperorimproper,andthedecisionswemakecanbefairorunfair.ExchangegainAgainontheexchangeofonecurrencyforanotherduetoappreciationinthehomecurrency.ExchangelossAlossontheexchangeofonecurrencyforanotherduetodepreciationinthehomecurrency.ExchangeratesTheratesatwhichforeigncurrencycanbeexchangedforthedomesticcurrency.ExpectedactivitycapacityExpectedactivityoutputforthecomingyear.ExpensesExpiredcosts.ExternalconstraintsLimitingfactorsimposedonthefirmfromexternalsources(suchasmarketdemand).852•68183_glossary_849-860.qxd1/22/042:27PMPage852budget,thebudgetedbalancesheet,thebudgetedstatementofcashflows,andthecapitalbudget.FinancialmeasuresMeasuresexpressedindollarterms.FinancialperspectiveAbalancedscorecardviewpointthatdescribesthefinancialconsequencesofactionstakenintheotherthreeperspectives.FinancialproductivitymeasureAproductivitymeasureinwhichinputsandoutputsareexpressedindollars.FitnessofuseThesuitabilityofaproductforcarryingoutitsadvertisedfunctions.FixedactivityrateFixedactivitycostdividedbythetotalcapacityoftheactivitydriver.FixedcostCoststhat,intotal,areconstantwithintherelevantrangeastheactivityoutputvaries.FixedoverheadspendingvarianceThedifferencebetweenactualfixedoverheadandappliedfixedoverhead.FixedoverheadvolumevarianceThedifferencebetweenbudgetedfixedoverheadandappliedfixedoverhead;itisameasureofcapacityutilization.FlexiblebudgetAbudgetthatcanspecifycostsforarangeofactivity.FlexiblebudgetvarianceThesumofpricevariancesandefficiencyvariancesinaperformancereportcomparingactualcoststoexpectedcostspredictedbyaflexiblebudget.FlexibleresourceResourcesthatarepurchasedasusedandneeded.Thereisnounusedorexcesscapacityfortheseresources.ForeigntradezonesAreasthatarephysicallyonU.S.soilbutconsideredtobeoutsideU.S.commerce.Goodsimportedintoaforeigntradezonearedutyfreeuntiltheyleavethezone.ForwardcontractAnagreementthatrequiresthebuyertoexchangeaspecifiedamountofacurrencyataspecifiedrate(theforwardrate)onaspecifiedfuturedate.FullenvironmentalcostingTheassignmentofallenvironmentalcosts,bothprivateandsocietal,toproducts.HeterogeneityWhenthereisagreaterchanceofvariationintheperformanceofservicesthanintheproductionofproducts.HiddenqualitycostsOpportunitycostsresultingfrompoorquality.High-lowmethodAmethodforfittingalinetoasetofdatapointsusingthehighandlowpointsinthedataset.Foracostformula,thehighandlowpointsrepresentthehighandlowactivitylevels.Itisusedtobreakoutthefixedandvariablecomponentsofamixedcost.HomogeneouscostpoolAcollectionofoverheadcostsassociatedwithactivitiesthathavethesameprocessandthesamelevelandcanusethesameactivitydrivertoassigncoststoproducts.IdealstandardsStandardsthatreflectperfectoperatingconditions.ImpactanalysisAlife-cycleassessmentstepwheretheenvironmentalimpactsofdifferentproduct(orprocess)designsarecomparedandevaluated.ImprovementanalysisAlife-cycleassessmentstepwhereeffortsaremadetoreducetheenvironmentalimpactsrevealedbytheinventoryandimpactsteps.IncentivesThepositiveornegativemeasurestakenbyanorganizationtoinduceamanagertoexertefforttowardachievingtheorganization'sgoals.Incremental(orbaseline)budgetingThepracticeoftakingtheprioryear'sbudgetandadjustingitupwardordownwardtodeterminenextyear'sbudget.IndependentprojectsProjectsthat,ifacceptedorrejected,willnotaffectthecashflowsofanotherproject.IndependentvariableAvariablewhosevaluedoesnotdependonthevalueofanothervariable.Forexample,inthecostformulaY_F_VX,thevariableXisanindependentvariable.FullprivatecostingTheassignmentofonlyprivatecoststoindividualproducts.Functional-basedcosting(FBC)Anapproachforassigningcostsofsharedresourcestoproductsandothercostobjectsusingonlyproductionorunit-leveldrivers.Functional-basedmanagement(FBM)Amanagerialapproachthatattemptstocontrolcostsbyfocusingontheefficiencyoforganizationalsubunits.Functional-basedmanagement(FBM)accountingsystemAnaccountinginformationsystemthatemphasizestheuseoffunctionalorganizationalunitstoassignandmanagecosts.Functional-basedresponsibilityaccountingsystemAcontrolsystemdefinedbycenteringresponsibilityonorganizationalunitsandindividualswithtraditionalbudgetsandstandardcostingusedtoevaluateandmonitorperformance.FuturevalueThevaluethatwillaccumulatebytheendofaninvestment'slifeiftheinvestmentearnsaspecifiedcompoundedreturn.GGainsharingProvidingcashincentivesforacompany'sentireworkforcethatarekeyedtoqualityandproductivitygains.GoalcongruenceThealignmentofamanager'spersonalgoalswiththoseoftheorganization.GoodnessoffitThedegreeofassociationbetweenYandX(costandactivity).ItismeasuredbyhowmuchofthetotalvariabilityinYisexplainedbyX.HHalf-yearconventionTheassumptionthatanewlyacquiredassetisinserviceforone-halfyearofitsfirsttaxableyearregardlessofthedatetheserviceactuallybegan.HedgingAwayofinsuringagainstgainsandlossesonforeigncurrencyexchange.•85368183_glossary_849-860.qxd1/22/042:27PMPage853IndirectcostsCoststhatcannotbetracedtoacostobject.IndustrialvaluechainThelinkedsetofvalue-creatingactivitiesfrombasicrawmaterialstoend-usecustomers.InnovationprocessAprocessthatanticipatestheemergingandpotentialneedsofcustomersandcreatesnewproductsandservicestosatisfythoseneeds.Inputtrade-offefficiencyTheleastcost,technicallyefficientmixofinputs.InseparabilityThefactthatproducersofservicesandbuyersofservicesmustusuallybeindirectcontactforanexchangetotakeplace.IntangibilityWhenbuyersofservicescannotsee,feel,hear,ortasteaservicebeforeitisbought.InterceptparameterThefixedcost,representingthepointwherethecostformulainterceptstheverticalaxis.InthecostformulaY_F_VX,Fistheinterceptparameter.InternalbusinessprocessperspectiveAbalancedscorecardviewpointthatdescribestheinternalprocessesneededtoprovidevalueforcustomersandowners.InternalconstraintsLimitingfactorsfoundwithinthefirm(suchasmachinetimeavailability).InternalfailurecostsCostsincurredbecauseproductsandservicesfailtoconformtorequirementswherelackofconformityisdiscoveredpriortoexternalsale.InternallinkagesRelationshipsamongactivitieswithinafirm'svaluechain.InternalmeasuresMeasuresthatrelatetotheprocessesandcapabilitiesthatcreatevalueforcustomersandshareholders.InternalrateofreturnTherateofreturnthatequatesthepresentvalueofaproject'scashinflowswiththepresentvalueofitscashoutflows(i.e.,itsetstheNPVequaltozero).Also,therateofreturnbeingearnedonfundsthatremaininternallyinvestedinaproject.andothercostobjects.ActivityeliminationTheprocessofeliminatingnonvalue-addedactivities.ActivityflexiblebudgetThepredictionofwhatactivitycostswillbeasactivityusagechanges.ActivityinputsTheresourcesconsumedbyanactivityinproducingitsoutput(theyarethefactorsthatenabletheactivitytobeperformed).AdministrativecostsAllcostsassociatedwiththegeneraladministrationoftheorganizationthatcannotbereasonablyassignedtoeithermarketingorproduction.Advancepricingagreements(APAs)AgreementsbetweentheInternalRevenueServiceandataxpayerontheacceptabilityofatransferprice.Theagreementisprivateandisbindingonbothpartiesforaspecifiedperiodoftime.AestheticsAqualityattributethatisconcernedwiththeappearanceoftangibleproducts(forexample,styleandbeauty)aswellastheappearanceofthefacilities,equipment,personnel,andcommunicationmaterialsassociatedwithservices.AllocationAssignmentofindirectcoststocostobjects.AnnuityAseriesoffuturecashflows.AppliedoverheadOverheadassignedtoproductionusingpredeterminedrates.AppraisalcostsCostsincurredtodeterminewhetherproductsandservicesareconformingtorequirements.BBalancedScorecard(SeeStrategicbasedresponsibilityaccountingsystem.)BaseperiodApriorperiodusedtosetthebenchmarkformeasuringproductivityInternalvaluechainThesetofactivitiesrequiredtodesign,develop,KaizenstandardAninterimstandardthatreflectstheplannedimprovementforacomingperiod.KanbansystemAninformationsystemthatcontrolsproductiononademand-pullbasisthroughtheuseofcardsormarkers.Keep-or-dropdecisionsRelevantcostinganalysesthatfocusonkeepingordroppingasegmentofabusiness.LLaborefficiencyvariance(LEV)Thedifferencebetweentheactualdirectlaborhoursusedandthestandarddirectlaborhoursallowedmultipliedbythestandardhourlywagerate.Laborratevariance(LRV)Thedifferencebetweentheactualhourlyratepaidandthestandardhourlyratemultipliedbytheactualhoursworked.LagmeasuresOutcomemeasuresormeasuresofresultsfrompastefforts.Leadmeasures(performancedrivers)Factorsthatdrivefutureperformance.LeadtimeForpurchasing,thetimetoreceiveanorderafteritisplaced.Formanufacturing,thetimetoproduceaproductfromstarttofinish.Learningandgrowth(infrastructure)perspectiveAbalancedscorecardviewpointthatdefinesthecapabilitiesthatanorganizationneedstocreatelong-termgrowthandimprovement.LifecyclecostsAllcoststhatareassociatedwiththeproductforitsentirelifecycle.Life-cycleassessmentAnapproachthatidentifiestheenvironmentalconsequencesofaproductthroughitsentirelifecycleandthensearchesforopportunitiestoobtainenvironmentalimprovements.Life-cyclecostassessmentAmethodthatassignscostsandbenefitstoenvironmentalconsequencesandimprovements.Life-cyclecostmanagementThemanagementofvalue-chainactivitiessothatalong-termcompetitiveadvantageisduce,market,distribute,andserviceaproduct(theproductcanbeaservice).InventoryThemoneyanorganizationspendsinturningrawmaterialsintothroughput.InventoryanalysisAlife-cycleassessmentstepwherethequantitiesandtypesofmaterials,energy,andenvironmentalreleasesaredescribed.InvestmentcenterAdivisionofacompanythatisevaluatedonthebasisofreturnoninvestment.JJust-in-timemanufacturingAdemand-pullsystemwhoseobjectiveistoeliminatewastebyproducingaproductonlywhenitisneededandonlyinthequantitiesdemandedbycustomers.JITpurchasingApurchasingmethodthatrequiressupplierstodeliverpartsandmaterialsjustintimetobeusedinproduction.JITIIAformofaJITpurchasingmethodthatrequiresthesupplier'ssalesrepresentativetoworkonsite(onafull-timebasis)atthecustomer'sfacilitywhilebeingpaidbythesupplier.JobOnedistinctunitorsetofunits.Job-ordercostsheetAsubsidiaryaccounttothework-in-processaccountonwhichthetotalcostsofmaterials,labor,andoverheadforasinglejobareaccumulated.Job-ordercostingsystemAcostingsysteminwhichcostsarecollectedandassignedtounitsofproductionforeachindividualjob.JointproductsProductsthatareinseparablepriortoasplit-offpoint.Allmanufacturingcostsuptothesplit-offpointarejointcosts.JointventureAtypeofpartnershipinwhichinvestorsco-owntheenterprise.KKaizencostingEffortstoreducethecostsofexistingproductsandprocesses.854-68183_glossary_849-860.qxd1/22/042:27PMPage854LinearprogrammingAmethodthatsearchesamongpossiblesolutionsuntilitfindstheoptimalsolution.LinepositionsPositionsthathavedirectresponsibilityforthebasicobjectivesofanorganization.LongrunAperiodoftimeinwhichallcostsarevariable.LooseconstraintsConstraintswhoselimitedresourcesarenotfullyusedbyaproductmix.MMake-or-buydecisionsRelevantcostinganalysesthatfocusonwhetheracomponentshouldbemadeinternallyorpurchasedexternally.ManagementaccountinginformationsystemAninformationsystemthatproducesoutputsusinginputsandprocessesneededtosatisfyspecificmanagementobjectives.ManufacturingcellsMachinesgroupedinfamilies,usuallyinasemicircle,sothattheycanbeusedtoperformavarietyofoperationsinsequence.Eachcellissetuptoproduceaparticularproductorproductfamily.MaquiladoraManufacturingplantslocatedinMexicothatprocessimportedmaterialsandre-exportthemtotheUnitedStates.MarginTheratioofnetoperatingincometosales.MarginofsafetyTheunitssoldorexpectedtobesoldorsalesrevenueearnedorexpectedtobeearnedabovethebreak-evenvolume.Marketing(selling)costsThecostsnecessarytomarketanddistributeaproductorservice.MarkupThepercentageappliedtoabasecost;itincludesdesiredprofitandanycostsnotincludedinthebasecost.MasterbudgetThecollectionofallareaandactivitybudgetsrepresentingafirm'scomprehensiveplanofaction.Materialspricevariance(MPV)ThedifferencebetweentheactualpricepaidperunitofmaterialsandtheNNetincomeOperatingincomelessincometaxes.NetpresentvalueThedifferencebetweenthepresentvalueofaproject'scashinflowsandthepresentvalueofitscashoutflows.NondiscountingmodelsCapitalinvestmentmodelsthatidentifycriteriaforacceptingorrejectingprojectswithoutconsideringthetimevalueofmoney.NonfinancialmeasuresMeasuresexpressedinnonmonetaryunits.Noninventoriable(period)costsCoststhatareexpensedintheperiodinwhichtheyareincurred.NonmonetaryincentivesTheuseofpsychologicalandsocialrewardstomotivatemanagers.NonproductioncostsCostsassociatedwiththefunctionsofsellingandadministration.Nonunit-levelactivitydriversFactorsthatmeasuretheconsumptionofnonunit-levelactivitiesbyproductsandothercostobjects.Nonunit-leveldriversFactors,otherthanthenumberofunitsproduced,thatmeasurethedemandsthatcostobjectsplaceonactivities.Nonvalue-addedactivitiesAllactivitiesotherthanthosethatareabsolutelyessentialtoremaininbusiness.Nonvalue-addedcostsCoststhatarecausedeitherbynonvalue-addedactivitiesorbytheinefficientperformanceofvalued-addedactivities.NormalactivitycapacityTheaverageactivityoutputforagivenperiod.NormalcostofgoodssoldThecostofgoodssoldbeforeadjustmentforanyoverheadvariance.NormalcostingAnapproachthatassignstheactualcostsofdirectmaterialsanddirectlabortoproductsbutusesapredeterminedratetoassignoverheadcosts.0ObjectivefunctionThefunctiontobeoptimized,usuallyaprofitfunction;standardpriceallowedperunitmultipliedbytheactualquantityofmaterialspurchased.MaterialsrequisitionformAsourcedocumentthatrecordsthetype,quantity,andunitpriceofthedirectmaterialsissuedtoeachjob.Materialsusagevariance(MUV)Thedifferencebetweenthedirectmaterialsactuallyusedandthedirectmaterialsallowedfortheactualoutputmultipliedbythestandardprice.MaximumtransferpriceThetransferpricethatwillmakethebuyingdivisionnoworseoffifanoutputissoldinternally.MethodofleastsquaresAstatisticalmethodtofindalinethatbestfitsasetofdata.Itisusedtobreakoutthefixedandvariablecomponentsofamixedcost.MinimumtransferpriceThetransferpricethatwillmakethesellingdivisionnoworseoffifanoutputissoldinternally.MixedcostCoststhathavebothafixedandavariablecomponent.Modifiedacceleratedcostrecoverysystem(MACRS)Anallowablemethodforcomputingdepreciationfortaxpurposes.MonetaryincentivesTheuseofeconomicrewardstomotivatemanagers.Multinationalcorporation(MNC)Acorporationforwhichasignificantamountofbusinessisdoneinmorethanonecountry.Multiple-periodqualitytrendreportAgraphthatplotsqualitycosts(asapercentageofsales)againsttime.MultipleregressionTheuseofleastsquaresanalysistodeterminetheparametersinalinearequationinvolvingtwoormoreexplanatoryvariables.MutuallyexclusiveprojectsProjectsthat,ifaccepted,precludetheacceptanceofcompetingprojects.MyopicbehaviorManagerialactionsthatimprovebudgetaryperformanceintheshortrunattheexpenseofthelong-runwelfareoftheorganization.•85568183_glossary_849-860.qxd1/22/042:27PMPage855thus,optimizationusuallymeansmaximizingprofits.ObjectivemeasuresMeasuresthatcanbereadilyquantifiedandverified.ObservablequalitycostsQualitycoststhatareavailablefromanorganization'saccountingrecords.OperatingassetsAssetsusedtogenerateoperatingincome,consistingusuallyofcash,inventories,receivables,andproperty,plant,andequipment.OperatingbudgetsBudgetsassociatedwiththeincome-producingactivitiesofanorganization.OperatingexpensesThemoneyanorganizationspendsinturninginventoriesintothroughput.OperatingincomeRevenuesminusexpensesfromthefirm'snormaloperations.Incometaxesareexcluded.OperatingleverageTheuseoffixedcoststoextracthigherpercentagechangesinprofitsassalesactivitychanges.Leverageisachievedbyincreasingfixedcostswhileloweringvariablecosts.OperationcostingAhybridcostingmethodthatassignsmaterialscosttoaproductusingajob-orderapproachandassignsconversioncostsusingaprocessapproach.OperationalproductivitymeasureAmeasurethatisexpressedinphysicalterms.OperationsprocessAprocessthatproducesanddeliversexistingproductsandservicestocustomers.OpportunitycostThebenefitsacrificedorforegonewhenonealternativeischosenoveranother.OpportunitycostapproachAtransferpricingsystemthatidentifiestheminimumpricethatasellingdivisionwouldbewillingtoacceptandthemaximumpricethatabuyingdivisionwouldbewillingtopay.OptimalsolutionThefeasiblesolutionthatproducesthebestvaluefortheobjectivefunction(thelargestvalueifseekingtomaximizetheobjectivefunction;theminimumotherwise).thepracticalcapacityoftheactivitydriverassociatedwiththepool.PostauditAfollow-upanalysisofaninvestmentdecision,comparingactualbenefitsandcostswithexpectedbenefitsandcosts.PostpurchasecostsThecostsofusing,maint