Week 2 Flashcards
1
Q
product costs
A
- direct labour
- direct materials
- MFG overhead
2
Q
COGM
A
beginning WIP \+ GM used \+ DL used \+ OH applied - ending WIP
3
Q
COGS
A
beginning finished product
+ COGM
- ending finished goods
4
Q
job costing
A
- used when jobs are separately identifiable
5
Q
process costing
A
used in mass production
6
Q
transfer price methods
A
- cost based
- market based
- negotiated absed
7
Q
transfer price - cost based
A
- full cost base measures the full absorptioncost of the product
- variable cost measures the variable cost of the product plus a mark-up
- useful when prices are not readily available
8
Q
transfer price - market based
A
- based on external suppliers and prices
- can lead to optimal decisions when
a) the immediate market is perfectly competitive and readily available
b) inter dependencies between departments must be minimal
c) use longer term prices to asmooth transfer prices
9
Q
transfer price - negotiation based
A
- working with each other to determine an understood price
- can be time consuming
- if the selling company can sell for more than the buying division would pay for it, should sell to an outside party
10
Q
governance purpose
A
- reduce ambiguity and confusion in the organization
- enhance effectiveness of strategy, risk management, resource allocation
- enhance relationships between mgmt and principles
- reduce risk of organizational failure
11
Q
Organizational structures
A
- simple
- functional
- divisional
- matrix
- network
12
Q
organizational structures - simple
A
- has an owner, single shareholder, or small group who manages and makes decisions
- quick decision making
- can keep decisions quick and in line with strategic objectives
13
Q
organizational structure - Functional
A
- departments are defined by their purpose (accounting, HR, processing)
- allows specialization in your area
- interdepartmental communication can become limited
14
Q
organizational structure - divisional
A
- each division has its own resources and managed as a separate business
- decision making decentralized with more autonomy
- can create competition between divisions
15
Q
organizational structure - matrix
A
- combines the stability of the functional structure and the flexibility of the divisional structure
- can have an unclear chain of command
16
Q
organizational structures - centralized
A
- more appropriate when there are few leaders
- quicker decision making
- fewer layers of management
17
Q
organizational structures - decentralized
A
- usually have teams with their own leaders
- facilitates growth
