BEC 3 - Operations Management: Cost Accounting and Performance Management
Terms in this set (15)
What are the most frequent cost objectives?
What are prime costs? Conversion costs?
What is traditional costing?
use overhead rate derived form budgeted overhead costs and estimated cost drive
What costs may be semi-variable?
-maintenance/repairs of buildling
What are the kinds of cost accumulation systems?
-job costing: for custom orders
-process costing: for mass-produced products
-operations costing: hybrid of job and process
-backflush costing: accts for certain costs at end of process when little need for in-process inv valuation
-life-cycle costing: monitors costs throughout product's life cycle
What is the basic formula for total factor productivity ratios (TFPs)? For partial productivity ratios (PPRs)?
TFP = qty of output / cost
PPR = qty of output / qty of inputs
What are the types of responsibility segments or strategic business units (SBUs)?
What are the areas of accountability in financial scorecards?
What is the formula for controllable margin?
controllable margin = contribution margin - controllable fixed costs
What are the classification of critical success factors in a balanced scorecard?
-internal business processes
-advancement of innovation and HR development
What classifications does a balanced scorecard typically describe?
-critical success factors
-related measures associated with strategic and tactical goals
What are the components of ROI?
ROI = profit margin x investment turnover
profit margin = income/sales
investment turnover = sales/invested capital
What are the limitations of ROI?
-disincentive to invest
What is the DuPont ROE formula? What is the extended DuPont ROE formula?
DuPont ROE = Net profit margin x asset turnover x Financial leverage
=ROA x Financial leverage
= NI/sales x sales/assets x assets/equity
Extended DuPont ROE = Tax burden x Interest burden x EBIT margin x Asset turnover x Financial leverage
=NI/pre-tax inc x pre-tax inc/EBIT x EBIT/sales x sales/assets x assets/equity
How do you calculate Economic Value Added (EVA)?
EVA = NOPAT - Req'd return (investment x WACC)