ETS Business Major Field Test: Systems Development

Activity-based Cost Accounting

   A.  Accumulate overhead costs for each activity

   B.  Assign the costs to cost objectives

Cost Management System

   A.  Measure the resources used

   B.  Assess the efects of costs of change

Just-in-Time System - Purchase and produce when needed in the production

1. Working within constraints - MCS must fit organization's structure

2.  Idenfication of responsibility centers

   A.  Cost Center - where costs are accumulated

   B. Profit Center - Measures revenue less costs

   C. Investment Center - Measures net income to invested capital

3. Weighing costs and benefits - maximum benefits at minimum costs

4. Motivation of employees

   A. Goal Congruence

   B.  Managerial Effort 

5. Design of Internal Controls - Prevent and detect errors, irregularities and promote operational efficiency

   A. Accounting Controls - Separation of duties, etc.

   B. Administrative Controls - Budgets for planning, controlling, and evaluating

6.  Development of measures of performance (financial and non-financial)