ACCT2012 Lecture 3 Flashcards Preview

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Flashcards in ACCT2012 Lecture 3 Deck (10):
1

Inventorial Product Costs

Direct + Indirect costs of producing goods

*consists of manufacturing process costs only

2

Job Costing

Process for assigning costs to custom products

*cost objects = individual jobs
*DM, DL traced to particular job (by source docs)
*manufacturing overhead allocated (i.e. all production costs - DM - DL)

*2-stage process

3

Cost Pool

group of individual costs that are accumulated for a particular purpose.

4

Actual Costing

allocation rate = actual costs / actual quantity of AB

5

Normal Costing

allocation rate = estimated costs / estimated quantity of AB

applied overhead = estimated rate x actual quantity of AB

6

Overapplied (Underapplied)

actual costs are less (more) than total amount of overhead allocated

*Under normal costing, periodic adjustments are needed to reconcile

7

Process Costing

approach for assigning product costs to mass‐produced products.

8

2 stage process

1. Costs are assigned to departments
2. Allocated from departments to individual product units.

9

Conversion Costs

DL + Manufacturing Overhead

10

Weighted Average Costing Method

costs from beginning WIP are averaged with costs incurred during current period, and then allocated to units completed and ending WIP