Accounting for decision makers C213 WGU

"Break even analysis" - Cost Volume profit analysis (CVP) "the line" is income from continuing operations. Reported "net of taxes" - Below the line items 1 paid in capital, 2 retained earnings, 3 treasure stock, 4 accumulated other comprehensive income. - Owners Equity 1. Identify overhead cost. 2. Analyze individual overhead costs in terms of cost activities COST POOLS. 3. Identify measurable cost drivers (numerical # such as gallons). 4. Assign overhead. 5. Use the ABC date to make decisions - 5 steps in the activity based costing (ABC) 1. Invoice by invoice, detail categorization. 2. Scattergraph method, a visual approach. 3. highlow method, a computational approach. - 3 approaches to do the CVP: 1. Prepare 2. Analyze 3. Gather 4. Make decisions 5. Implement 6. Observe. - Accounting steps. 5 steps of ABC system - Identify overhead cost activities, analyze individual overhead costs in terms of those cost activities, identify measurable cost drivers, assign overhead, and use the cost data to make decisions A common-size balance sheet is often prepared using total ? - assets to standardize each amount instead of using total sales, in which case the asset percentages are a good indication of the company's asset mix. A company's asset mix is strongly influence by - the companies industry A company's asset mix is: - the proportion of total assets in each asset category and is largely determined by the industry in which the company operates. Financing mix is the result of management decisions. A company's break-even point would change if there were an increase in: - Total fixed costs due to a plant addition A company's internal control structure can be divided into five basic categories - The control environment Risk assessment Control activities Information and communication Monitoring