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Definition of activity
a repetitive action performed in fulfillment of business functions
the process of detailing the various repetitive actions that are performed in making a product or
A method of budgeting that develops budgets based on expected activities and cost drivers – see also activity-based costing.
planning approach applying activity drivers to estimate the levels and costs of activities necessary to provide the budgeted quantity and
A method of costing that uses cost pools to accumulate the cost of significant business activities and then assigns the costs from the cost pools to products or services based on cost drivers.
A relatively new method advocated for the
a process using multiple cost drivers to predict and allocate costs to products and services;
A cost allocation system that compiles costs and assigns
a discipline that focuses on the activities incurred during the production/performance process as the way to improve the value received
a segment of the production or service
a measure of the demands on activities and,
hours, machine hours or volume of production
Ratios that measure how effectively the firm is managing its assets.
an activity that is necessary for the operation of the business but for which a customer would not want to pay
an activity that increases the time spent on a product or service but that does not increase its worth or value to the customer
an activity that increases the worth of the product or service to the customer
see activity-based costing
see activity-based management
Aggressive Cost Capitalization
Cost capitalization that stretches the flexibility within generally
The process of storing costs in one account and shifting them to other
the amount of overhead that has been assigned to Work in Process Inventory as a result of productive activity; credits for this amount are to an overhead account
attribute-based costing (ABC II)
an extension of activitybased costing using cost-benefit analysis (based on increased customer utility) to choose the product attribute
Bank for International Settlements (BIS)
An international bank headquartered in Basel, Switzerland, which
break-even point (BEP)
the level of activity, in units or dollars, at which total revenues equal total costs
A detailed schedule of financial activity, such as an advertising budget, a sales budget, or a capital budget.
A plan expressed in monetary terms covering a future period of time and based on a defined
a financial plan for the future based on a single level
a measure of production volume or some other activity base
a process of evaluating an entity’s proposed
an external party that has been granted an
the difference between selling price and
a graphical presentation of the results of a
a higher proficiency relative to competitors
The most significant cause of the cost of an activity, a measure of the demand for an activity
a factor that has a direct cause-effect relationship
A factor that directly impacts the incidence of a cost, and which is generally
An item for which a cost is compiled. For example, this can be a product,
A prolonged period of very low economic activity with large-scale unemployment.
a cost that is periodically reviewed by a
e-commerce (electronic commerce)
any business activity that uses the Internet and World Wide Web to engage in financial transactions
a cost that has been found to bear an observable
A change in government spending or taxing, designed to influence economic activity.
a cost that remains constant in total within a specified
A cost that does not vary in the short run, irrespective of changes in any
fixed expenses (costs)
Expenses or costs that remain the same in amount,
That portion of total overhead costs which remains constant in size
a presentation of multiple budgets that
a technique used to determine the fixed
An unwritten understanding between two groups, such as an understanding between an employer and employees that employees will receive a stable wage despite business cycle activity.
A cost that is not directly associated with a single activity or event. Such
The category describing a company's primary business activity. This category is usually determined
Basic facilities, such as transportation, communication, and legal systems, on which economic activity depends.
a philosophy about when to do something;
A market is liquid when it has a high level of trading activity, allowing buying and selling with
Margin of safety
A measure of the difference between the anticipated and breakeven levels of activity.
Market timing costs
Costs that arise from price movement of the stock during the time of the transaction
a cost that has both a variable and a fixed component;
Actions taken by the central bank to change the supply of money and the interest rate and thereby affect economic activity.
National Income and Product Accounts
The national accounting system that records economic activity such as GDP and related measures.
Includes all the sales and expense activities of a business.
The net income of a business, less the impact of any financial activity,
The 80:20 ratio that states that 20% of the variables included in an
predetermined overhead rate
an estimated constant charge per unit of activity used to assign overhead cost to production or services of the period; it is calculated by dividing total budgeted annual overhead at a selected level of volume or activity by that selected measure of volume or activity; it is also the standard overhead application rate
an activity measure that, when changed, is accompanied
Loosely speaking, a period of less-than-normal economic growth. Technically, a downturn in economic activity in which real GDP falls in two consecutive quarters.
The upper and lower levels of activity within which the business expects to be operating within the short-term planning horizon (the budget period).
the specified range of activity over which a
a resource that is essential to production
a graph that plots all known activity observations
New security issues are first sold directly to the public by the issuing firm or the government. After this initial sale, the owners of the securities can trade them among themselves or others; such activity is said to take place on the secondary market.
Costs that are constant within a defined level of activity but that can increase or decrease when
Abbreviation for Standard Industrial Classification. Each 4-digit code represents a unique business activity.
a cost that increases in distinct amounts because of increased activity
View that incentives to work, save, and invest play an important role in determining economic activity by affecting the supply side of the economy.
Mutual Funds: A measure of trading activity during the previous year, expressed as a percentage of
Economic activity not observed by tax collectors and government statisticians.
a cost that varies in total in direct proportion
A cost that changes in amount in relation to changes in a related activity.
variable overhead efficiency variance
the difference between budgeted variable overhead based on actual input activity and variable overhead applied to production
variable overhead spending variance
the difference between total actual variable overhead and the budgeted amount of variable overhead based on actual input activity
The number of times during a year that the money supply turns over in supporting that year's economic activity, measured as the ratio of nominal income to the money supply.
Waiver of Premium
This is an option available to the applicant for life insurance which sets certain conditions under which an insurance policy will be kept in full force by the insurance company without the payment of premiums. Very specifically, a life insured would have to become totally disabled through injury or illness for a period of six months before the benefit kicks in. When it does, the insurance company retroactively pays premiums from the beginning of the disability until the time the insured is able to perform some form of regular activity. 'Totally disabled' is highlited here, because that is what is required to receive this benefit.
A list of securities selected for special surveillance by a brokerage, exchange or regulatory
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