An Introduction to Managerial Accounting and Cost Concepts

1-1 Chapter 1 An Introduction to Managerial Accounting and Cost Concepts Introduction to Managerial Accounting MSc. Mohammad Hicham Khalil Objectives 1. Comparison of Financial and Managerial 2. 3. 4. 5. 6. 7. 8. Accounting. General Cost Classifications. Product Cost versus Period Cost. Cost Classifications on Financial Statements. Cost Classifications for Predicting Cost Behavior. Cost Classification for Assigning Costs to Cost Objectives. Cost Classification for Decision Making. Review Problems MSc. Mohammad Hicham Khalil Introduction to Managerial Accounting 1-2 Learning Objective 1 Comparison of Financial and Managerial Accounting Introduction to Managerial Accounting MSc. Mohammad Hicham Khalil†¦show more content†¦Product costs consist of: Direct materials. Direct labor. Manufacturing overhead. Product costs are sometimes called â€Å"Inventoriable cost†. Introduction to Managerial Accounting MSc. Mohammad Hicham Khalil 1-11 Period Costs Are all the costs that are not included in p product costs. These costs are expensed on the income statement in the period in which they are incurred. All Selling, General and Administrative Costs a e considered are co s de ed to be pe od costs period costs. Introduction to Managerial Accounting MSc. Mohammad Hicham Khalil Product Costs VS Period Costs Product costs include direct materials, direct , labor, and manufacturing overhead. Inventory Cost of Goods Sold Period costs are not included in product p costs. They are expensed on the income statement. Expense Sale Balance Sheet Income Statement Income Statement MSc. Mohammad Hicham Khalil Introduction to Managerial Accounting 1-12 Introduction to Managerial Accounting MSc. Mohammad Hicham Khalil Quick Check Which of the following costs would be g considered a period rather than a product cost in a manufacturing company? A. Manufacturing equipment depreciation. B. Property taxes on corporate headquarters. C. Direct materials costs. D. Electrical costs to light the production facility. E. Sales commissions. Introduction to Managerial Accounting MSc. Mohammad Hicham Khalil 1-13 Quick Check Which ofShow MoreRelatedImportance of Managerial Accounting1005 Words   |  5 PagesIntroduction The purpose of management accounting in the organization is to support competitive decision making by collecting, processing, and communicating information that helps management plan, control, and evaluate business processes and company strategy. The interesting thing about management accounting is that it is rare to find an individual within a company with the title of â€Å"management accountant.† Often many individuals function as accountants within the organization, but these individualsRead MoreBUS 630 Final Paper1617 Words   |  7 PagesDecision Making with Managerial Accounting Managerial accounting is essential for decision making. 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