chm1 ppt slides

8/12/2019 Chm1 Ppt Slides

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Managerial Accounting

Managerial Accounting

Fifth Edition


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Managerial Accounting Basics

Managerial accounting, also called management

accounting, is a field of accounting that provides

economic and financial information for managers and

other internal users.

Managerial accounting applies to all types of

businesses.

Corporations Proprietorships

Partnerships

Not-for-profit


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Comparing Managerial And Financial Accounting



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Management Functions


Planning Directing Controlling

Looking ahead

Setting goals and

objectives

Coordinate activities

and human resources

Implement objectives

Provide incentives to

motivate employees

Hire/train employeesProduce smooth-

running operation

Keeping activities on

track

Determine whether

goals are met

Decide changes

needed to get back on

track


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Managerial Cost Concepts

Manufacturing consists of activities and processes

that convert raw materials into finished goods.

Manufacturing Costs


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Manufacturing Costs

MaterialsRaw Materials

Basic materials and parts used in manufacturing

process.

Direct Materials

Raw materials that can be physically and directly

associated with the finished product

Indirect MaterialsNot physically part of the finished product or

they are an insignificant


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Direct LaborLabor

Indirect Labor

Manufacturing Costs

Work of factory employees that can be physically anddirectly associated with the product.

Work of factory employees that has no physicalassociation with the finished product.


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Costs that are indirectlyassociated with manufacturingthe finished product.

Includes all manufacturing costs exceptdirect materialsand direct labor.

Manufacturing Overhead

Manufacturing Costs

BE4


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Product Versus Period Costs

BE6


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Cost of Goods Sold Components

Manufacturing Costs in Financial Statements


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Cost of goods sold sections of merchandisingand manufacturing income statements



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Determining the Cost of Goods ManufacturedTotal Work in Process(1) cost of beginning work in process and

(2) total manufacturing costs for the current period.

Total Manufacturing Costs sum of direct material costs, direct

labor costs, and manufacturing overhead in the current year.



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Cost of Goods Manufactured Schedule


BE 10 & 11


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Inventory accounts for a manufacturer

Balance Sheet


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Current assets sections of merchandising

and manufacturing balance sheets

Balance Sheet

BE9

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