Name 5 differences between financial and management accounting.
Audience - F External M Internal
Rules - F Accounting Standards M None
Detail - F Summarised M Detailed
Frequency - F Annual M Up to management
Tense - F Past M Future
Name 2 uses of management accounting
Comparing Budget vs Actual Revenue / Expenses
Name 3 users other than management which use management accounts
Lenders
Shareholders
Auditors
Name the 4 responsibility centre’s
Cost
Profit
Investment
Revenue
Name the 3 cost categories
Materials
Labour
Overheads
Name the 4 types of expense
Variable
Semi-Variable
Fixed
Stepped-fixed
Define a direct cost
Cost that can be attributed to the manufacture of a single product
Define an indirect cost
Costs which cannot be attributed to one product
Define a production overhead
An indirect cost which is closely associated with the direction of a product
Define a general overhead
Ab indirect cost which cannot be associated to any product
What is the total of all direct costs known as
Prime cost
How do you calculate the production cost
Direct cost + Production overheads
What is a product cost?
Any cost which can be attributed to a product.
What is a period cost?
General overheads which cannot be attributed to a single product.
Name the 5 cost recording systems.
Job Costing
Batch Costing
Unit Costing
Process Costing
Service Costing
When would you use job costing?
When a service is not repeated in identical form.
When would you use batch costing?
When products are made in batches.
When would you use unit costing?
When you need the cost per unit.
When would you use process costing
When the production of a product can be split into multiple processes
When would you use service costing
When a cost can be identified per service given e.g a train service.
How do you calculate contribution?
Total Sales Revenue - Variable Costs
