Quality Costs
Costs incurred after the company delivers poor-quality goods or services to customers and then has to make things right with the customer.
what are external failure?
total estimated cost / total estimated quantity
What is predetermined overhead allocation rate?
Suppliers deliver raw materials just in time to begin production, and finished units are completed just in time for delivery to customers.
What is JIT?
Contribution margin / Operating income
What is operating leverage?
Sales Revenue per Unit - Variable Costs per Unit
What is CM Per Unit?
costs incurred to avoid poor-quality goods or services
what are prevention costs?
predetermined overhead allocation rate * actual quantity
What is allocated MOH cost?
This is a benefit of JIT
What is low risk of inventory being unsalable
Contribution Margin - Fixed Costs
What is operating income?
What is CM?
Costs incurred when the company corrects poor-quality goods or services before delivery to customers.
What are internal failure?
Each activity has its own one of these
What is a cost driver?
This is a downside of JIT
What is risk of not having enough inventory due to many factors?
What is breakeven point?
This is how to go from CM per unit to total CM
What is multiplying by number of units?
Costs incurred to detect poor-quality materials, goods, or services
What are appraisal costs?
What is more accurate OH allocation?
This is the account used only in JIT
What is Raw and In-Process Inventory?
expected sales - breakeven point
What is margin of safety?
Contribution Margin / Net Sales Revenue
What is CM Ratio?
What is testing being involved?
What are pricing and product mix decisions and cost management decisions?
This is how things are produced in JIT
What is self contained cells?
This is the order to solve for operating leverage from step 1 for a problem that gives sales price and variable cost per unit?
What is ?
This is what the contribution margin is by definition
What is the amount that contributes to covering the fixed costs and then to providing operating income?