Chapter 3 Managerial Accounting-Job Costing Process Costing and Operations Costing

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davecowman
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Chapter 3 Managerial Accounting-Job Costing Process Costing and Operations Costing
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2015-10-20 12:55:19
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Job Costing, Process Costing, and Operations Costing
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  1. Job costing (p. 40)

    Custom
    A costing system that accumulates, tracks, and assigns costs for each job produced by a company
  2. Process Costing (p. 41)
    A costing system that accumulates and tracks costs for each process performed and then assigns those costs equally to each unit produced.

    Homogeneous.
  3. Operations Costing (p. 42)
    A hybrid of job and process costing; used by companies that make products in batches.

    Standardized withing batches.
  4. Direct Materials (p. 43)
    Direct material costs include the cost of the primary materials used in production, along with shipping costs and sales taxes.
  5. Fringe Benefits (p. 44)
    Payroll costs in addition to the basic hourly wage.
  6. Idle Time (p. 44)
    Worker time that is not used in the production of the finished product.
  7. Overtime Premium (p. 44)
    An additional amount added to the basic hourly wage owing to overtime worked by the workers.
  8. Allocation (p.45)
    The process of finding a logical method of assigning overhead costs to the products or services a company produces or provides.
  9. Cost Drivers (p. 45)
    Factors that cause, or drive, the incurrence of costs.
  10. Cost pool (p. 46)
    Groups of overhead costs that are similar; used to simplify the task of assigning costs to products with ABC costing.
  11. Overhead Rate (p. 46)
  12. Normal Costing (p. 47)
    A method of costing using an estimate of overhead and predetermined overhead rates instead of the actual amount of overhead.
  13. Predetermined Overhead Rate (for a cost pool) (p.48)
    Used to apply overhead to products; calculated by dividing the estimated overhead for a cost pool by the estimated units of the cost driver.

  14. Overapplied Overhead (p. 48)
    The amount of applied overhead in excess of actual overhead.
  15. Underapplied overhead (p. 48)
    The amount of actual overhead in excess of applied overhead.
  16. Equivalent units (p. 51)
    The number of finished units that can be made from the materials, labor, and overhead included in partially completed units.
  17. Conversion Cost (p. 52)
    The costs of direct labor and overhead incurred to convert the direct materials to a finished product.
  18. FIFO
    In the FIFO method, the equivalent units and unit costs for the current period relate only to the work done and the costs incurred in the current period.
  19. Weighted Average Method (p. 53)
    In contrast,in the weighted-average method,the units and costs from the current period are combined with the units and costs from last period in the calculation of equivalent units and unit costs.
  20. Production report (p. 56)
    Report that provides a summary of the units moving through a processing department during the period as well as a computation of equivalent units of production and the costs per equivalent unit.

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