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The following are nine technical accounting terms introduced or emphasized in this chapter. Transfer price Common fixed costs Responsibility margin Contribution margin Performance margin Traceable fixed costs Cost-plus transfer price Product costs Committed fixed costs Each of the following statements may (or may not) describe one of these technical terms. For each statement, indicate the accounting term described, or answer "None" if the statement does not cor- rectly describe any of the terms. The costs deducted from contribution margin to determine responsibility margin. a. b. Cost to produce plus a predetermined markup. c. Fixed costs that are readily controllable by the manager. d. A subtotal in a responsibility income statement, equal to responsibility margin plus committed fixed costs.

The following are nine technical accounting terms introduced or emphasized in this chapter. Transfer price Common fixed costs Responsibility margin Contribution margin Performance margin Traceable fixed costs Cost-plus transfer price Product costs Committed fixed costs Each of the following statements may (or may not) describe one of these technical terms. For each statement, indicate the accounting term described, or answer "None" if the statement does not cor- rectly describe any of the terms. The costs deducted from contribution margin to determine responsibility margin. a. b. Cost to produce plus a predetermined markup. c. Fixed costs that are readily controllable by the manager. d. A subtotal in a responsibility income statement, equal to responsibility margin plus committed fixed costs.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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E-6 The following are nine technical accounting terms introduced or emphasized in this chapter. Transfer price Common fixed costs Responsibility margin Contribution margin Performance margin Traceable fixed costs Cost-plus transfer price ogy Product costs Committed fixed costs Each of the following statements may (or may not) describe one of these technical terms. For each statement, indicate the accounting term described, or answer "None" if the statement does not cor- rectly describe The costs deducted from contribution margin to determine responsibility margin. b. Cost to produce plus a predetermined markup. c. Fixed costs that are readily controllable by the manager. d. A subtotal in a responsibility income statement, equal to responsibility margin plus committed fixed costs. any of the terms. a. с.
Transcribed Image Text:E-6 The following are nine technical accounting terms introduced or emphasized in this chapter. Transfer price Common fixed costs Responsibility margin Contribution margin Performance margin Traceable fixed costs Cost-plus transfer price ogy Product costs Committed fixed costs Each of the following statements may (or may not) describe one of these technical terms. For each statement, indicate the accounting term described, or answer "None" if the statement does not cor- rectly describe The costs deducted from contribution margin to determine responsibility margin. b. Cost to produce plus a predetermined markup. c. Fixed costs that are readily controllable by the manager. d. A subtotal in a responsibility income statement, equal to responsibility margin plus committed fixed costs. any of the terms. a. с.
979 The subtotal in a responsibility income statement that is most useful in evaluating the short-run effect of various marketing strategies on the income of the business. е. f. The subtotal in a responsibility income statement that comes closest to indicating the change in income from operations that would result from closing a particular part of the business. g. The amount used in recording products or services supplied by one business unit to another.
Transcribed Image Text:979 The subtotal in a responsibility income statement that is most useful in evaluating the short-run effect of various marketing strategies on the income of the business. е. f. The subtotal in a responsibility income statement that comes closest to indicating the change in income from operations that would result from closing a particular part of the business. g. The amount used in recording products or services supplied by one business unit to another.
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