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Accounting (73)
SMG AC 222 (24)
Lecture 1

SMG AC 222 Lecture 1: AC Notes Chapter 1

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SMG AC 222
Greg Sabin

Chapter 1 1. What is a business? a. Point of a business: b. Strategy i. Strategy: How you plan to achieve your goals c. Characteristics of good goals i. Good characteristics: objectives should be SMART specific, measurable, attainable, realistic, timeliness d. How do you know if e. Measure Performance f. Compensation 2. What is management accounting a. The process of identifying, measuring, recording, organizing, analyzing, and preparing financial and nonfinancial information i. Nonfinancial information can include b. Providing information to internal managers for planning, controlling, and decision making c. Financial accounting is essential for financial documents, mainly for investors and outside sources. Management accountants provide measurements of business events to inform, support and influence business decisions i. Use information to make decisions about the way the business is operated 3. Measuring Cost a. Cost is a consumption of a scare resource b. Variable Cost: Does the cost change when c. Fixed Cost d. Material: what goes into the product e. Labor: people working i. Direct and indirect: may or may not have first hand involvement in the production of the product f. Overhead: everything else i. Ex insurance, rent, etc. If related explicitly to the production process ii. Period cost: without respect to production (rent on HQ, SGA: sales general administration) g. Direct Cost: something that is explicitly involved with a product goes into the product directly h. Indirect Cost: Generally indirect material: i.e. i. Flow of Cost: i. Costs Balance sheet inventories Income statement expenses ii. ** SLIDE 5** iii. Cost of goods sold is reported in financial statements, cost of goods made **FILL** 4. Financial Statements
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