For Operational Control, a Management Accounting System Should Include

question 27

Multiple Choice

For operational control, a management accounting system should include:

• A) Performance measures associated with basic business processes.
• B) Only financial-control measures, such as standard cost variances.
• C) High-level financial metrics such as return on investment (ROI) or return on sales (ROS).
• D) A combination of short-term and strategic financial-performance metrics.
• E) Only flexible-budget cost and revenue variances.

Comprehend the distinction between microeconomics and macroeconomics topics.

Understand the role and implication of opportunity cost in making economic choices.

Recognize the importance of making choices due to scarce resources and its impact on opportunity cost.

Understand the concept and significance of physical capital in production processes.

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Definitions:

Weekly Disbursements

The total amount of cash paid by a business for its operational expenses on a weekly basis.

Miller-Orr Model

A financial model used to manage cash flow and cash reserves, helping firms to decide on the optimal level of cash balances and when to transfer funds.

Disbursements

Money paid out by a business or organization for various purposes, including expenses, investments, and dividends.