Cost Accounting Chapter 1: The Manager and Management Accounting

Budget
The Quantitative expression of a proposed plan of action by management and is an aid to coordinating what needs to be done to execute that plan.
Chief Financial Officer
The executive responsible for overseeing the financial operations of an organization. Perform controllership, treasury, risk management, taxation, investor relations, and strategic planning.
Control
allowing managers to compare actual performance to budgeted performance.
Controller
The financial executive primarily responsible for management accounting and financial accounting.Influences the behavior of all employees and helps line managers make better choices.
Cost Accounting
The process of measuring, analyzing, and reporting financial and non-financial information related to the costs of acquiring or using resources in an organization.
Cost-Benefit Approach
Managers should spend resources if the expected benefits to the company exceed the expected costs.
Cost Management
Used to describe the activities managers undertake to use resources in a way that increases a products value to customers and achieves an organizations goals. Not only about reducing costs, about
Customer Relationship Management (CRM)
Strategy that integrates people and technology in all business functions to deepen relationships with customers, partners, and distributors.
Customer Service
Providing after sales service to customers.
Design of Products and Processes
Detailing, planning, engineering and testing products and processes.
Distribution
Processing orders and shipping products or services to customers .
Finance Director
Another name for chief financial officer.
Financial Accounting
Focuses on reporting financial information to external parties such as investors, government agencies, banks, and suppliers based on GAAP.
Learning
Involves examining past performance and systematically exploring alternative ways to make better-informed decisions and plans in the future.
Line Management
Such as production, marketing, and distribution management, is directly responsible for achieving the goals of the organization.
Management Accounting
The process of measuring, analyzing, and reporting financial and non-financial information that helps managers make decisions to fulfill the goals of an organization.
Marketing
Promoting and selling products and services to customers or prospective customers.
Planning
Consists of selecting an organizations goals and strategies, predicting results under various alternative ways of achieving those goals, deciding how to attain desired goals, and communicating goals and how to achieve them.
Production
Procuring, transporting, and storing (inbound logistics) and coordinating and assembling (operations) resources to produce a product or deliver a service.
Research and Development
Generating and experimenting with ideas related to new products, services, or processes.
Staff Management
Provides advice, support, and assistance to line management.
Strategic Cost Management
describes cost management that specifically focuses on strategic issues.Who are our customers, what substitute products exist, what is our most critical capability, what cash do we have for funding it.
Strategy
Specifies how the organization matches its own capabilities with the opportunities in the marketplace. Businesses follow one of two broad categories. 1=Cost leadership strategy 2=product differentiation strategy. Critical decision for management.
Supply Chain
Describes the flow of goods, services, and information from the initial sources of materials and services to the delivery of products to consumers, regardless of whether those activities occur in one organization or in multiple organizations.
Sustainability
The development and implementation of strategies to achieve long-term financial, social, and environmental goals.
Total Quantity Management (TQM)
An integrative philosophy of management for continuously improving the quality of products and processes in every level of the value chain.
Value Chain
The sequence of business functions by which a product is made progressively more useful to customers. Six Primary Business functions: R&D, Design of products and processes, production, marketing (including sales), distributions, and customer service.
Key Success factors
Customers want companies to use the value chain and supply chain to deliver ever-improving levels of performance when it comes to several (or even all) of the following: Cost and Efficiency, Quality, Time, Innovation, and Sustainability. Cost accountants help managers track the key success factors of their firms as well as those of their competitors to create benchmarks.
Five Step Decision Making Process
Identify the problem and uncertainties, obtain information, make predictions about the future, make decisions by alternatives, and implement the decision evaluate performance and learn.