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Managerial Accounting chpt 1


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Accounting Information Systems (AIS)
a transaction processing sys. that captures financial data resulting from accounting transactions within a company
Enterprise resource planning Systems (ERP)
sys used to collect, organize, report, and distribute organizational data and transform that data into critical information and knowledge
reports, such as financial statements, customer lists, and inventory records
data that have been organized, processed and summarized
Information that have been organized, processed, and summarized
Data Warehouses
central depositories for electronic data
Data Mining
a process of searching for and extracting information from data
Knowledge Warehouses
Used to store and provide access to a wide variety of qualitative data
Electronic data interchange (EDI)
The elctronic transmission of data, such as purchase orders and invoices
Financial Accounting
the area of accounting primarily concerned with the preparation and use of general use financial statements for use by creditors, investors, and other users outside the company
Managerial Accoutning
the area of accounting primarily concerned with generating financial and nonfinancial information for users by managers in their decision-making roles within a company
External Users
Stockholders, potential investors, creditors, gov't taxing agencies, regulators, suppliers, customers, and other outside the company
Internal Users
Individual employees, teams, departments, regions, top management, and other inside the company- often referred to as managers
the development of both short term (operational)and long term (stategic) and goals of an organization and an identification of the resources needed to achieve them
Operational Planning
development of short term objectives and goals (typically those to be achieved in less than one year)
Strategic planning
addresses long-term questions of how an organization positions and distinguishes itself from competitors
Operating Activities
the day to day operations of a business
Controlling Activities
the motivation and monitoring of employees and the evaluation of people and other resources used in the operations of the organization
Operations and production function
produces the products or services that an organization sells to its customers
Marketing function
involved with the process of developing, pricing, promoting, and distributing goods and services sold to customers
Finance function
responsible for managing the financial resources of the organization
Human Resource function
concerned with the utilization of human resources to help an organization reach its goals
Decision Making
the process of identifying alternative courses of action and selecting an appropriate alternative in a given decision-making situation
can be expressed in terms of dollars or other quantities (units, pounds, etc.)
deals with nonnumerical attributes or charateristics
Relevant Costs
those costs that differ between alternatives
sunk costs
costs that have already been incurred
Opportunity Costs
the benefits forgone by choosing one alternative over another
the likelihood that an option chosen in a decision situation will yeild unsatisfactory results
Sensitivity analysis
the process of changing the values of key variables to determine how sensitive decisions are to those changes

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