ACC 6301 – Exam I Study Suggestions
You are responsible for any questions and problems that you were assigned for homework or that we worked in class. Also, you should be able to discuss and/or answer questions related to your readings/case(s) and the Wall Street Journal.
Cost Management and Strategy – refer to your assigned questions and problems Cost Drivers and Basic Cost Concepts -- What is a cost? Define cost pools. What is a cost object? cost assignment? Contrast a direct cost with an indirect cost. Define cost allocation. What is an allocation base? Contrast cost assignment with cost allocation. What is a direct material? Direct labor? Indirect material? Indirect labor? factory overhead? What are conversion costs? Prime costs?
What are the four types of cost drivers? Discuss each type and give examples. What is the relevant range, and how does it relate to cost behavior? What is a fixed cost? How does a fixed cost behave in total? On a per unit basis? How does a variable cost behave in total? On a per unit basis? How do these costs (in total and per unit) appear on a graph? What about a mixed (also known as a semivariable) cost? A fixed-step cost? A variable-step cost? How do changes in the activity level affect all of these costs? How do we calculate average cost per unit? Why must managers be careful when they talk about average cost or unit cost? What are the issues that impact structural cost drivers? What are the factors included in considering executional cost drivers? What is a step cost? When can a step cost be considered to behave like a fixed cost? When can a step cost be considered to behave like a variable cost? Calculate COGS (cost of goods sold) and COGM (cost of goods manufactured); Cost of materials placed into production. Be able to take a fact situation and calculate each of these costs. What is the gross margin? The gross margin percentage? How would you interpret the gross margin percentage? How would you interpret the COGS...
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