Karteikarten
Cost/Managerial Accounting Chapter 13 key terms
Karten in diesem Stapel (18)
- 1Avoidable costA cost that can be eliminated by choosing one alternative over another in a decision. This term is synonymous with differential cost and relevant cost.
- 2BottleneckA machine or some other part of a process that limits the total output of the entire system.
- 3ConstraintA limitation under which a company must operate, such as limited available machine time or raw materials, that restricts the company’s ability to satisfy demand.
- 4Differential costA future cost that differs between any two alternatives.
- 5Differential revenueFuture revenue that differs between any two alternatives.
- 6Incremental costAn increase in cost between two alternatives.
- 7Joint costsCosts that are incurred up to the split-off point in a process that produces joint products.
- 8Joint productsTwo or more products that are produced from a common input.
- 9Make or buy decisionA decision concerning whether an item should be produced internally or purchased from an outside supplier.
- 10Opportunity costThe potential benefit that is given up when one alternative is selected over another.
- 11Relaxing (or elevating) the constraintAn action that increases the amount of a constrained resource. Equivalently, an action that increases the capacity of the bottleneck.
- 12Relevant benefitA benefit that should be considered when making decisions.
- 13Relevant costA cost that should be considered when making decisions.
- 14Sell or process further decisionA decision as to whether a joint product should be sold at the split-off point or sold after further processing.
- 15Special orderA one-time order that is not considered part of the company’s normal ongoing business.
- 16Split-off pointThat point in the manufacturing process where some or all of the joint products can be recognized as individual products.
- 17Sunk costA cost that has already been incurred and that cannot be changed by any decision made now or in the future.
- 18Vertical integrationThe involvement by a company in more than one of the activities in the entire value chain from development through production, distribution, sales, and after-sales service.
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- Key terms Chapter 13 Cost/Managerial Accounting
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- Stephanie Poole · Nov 2022
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- 4 Nov 2022
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