Job Order Costing
Where materials, labor, and manufacturing overhead are recorded.
What is the job-cost sheet?
A commonly used method of accounting in which costs and outputs are solely derived from the current period
What is FIFO?
Contribution margin / Sales
A costing method used to provide managers with cost iinformation that can be used for strategic decisions.
What is activity based costing?
A number of seperate, but dependent budgets that lay out a firm's sales, production, and financial goals.
What is a master budget?
Used to assign costs to products.
What is allocation/allocation base?
DL + MOH
What is the break even point?
An allocation base that measures the amount of activity that drives costs.
What is an activity measure?
Gathering feedback to ensure that a plan is being completed successfully or to modify the plan.
What is control?
MOH/AB
What is the formula for predetermined overhead?
# of partially completed units x % complete
What is the formula for equivalent units?
Variable expenses / sales
What is variable expense ratio?
ABC systems trace ____________ such as commisions, shipping costs, and repairs to products.
What are direct nonmanufacturing costs?
The cash budget is derived from:
What are the direct materials budget, direct labor budget, manufacturing overhead budget?
y = a + bx
What is the formula to solve for total manufacturing overhead cost?
A hybrid system of costing.
What is operation costing?
A measure of how much net operating income may change based on a change in sales.
What is operating leverage?
The number of times an activity occurs.
What is a transaction driver?
A 12 month budget that rolls forward 1 month as the current month is completed.
What is a continuous or perpetual budget?
Cost driver
What is a factor that drives overhead costs called?
Step 1: Find number of equivalent units
Step 2: Find cost per equivalent unit
Step 3: Assign the cost to units
Step 4: Prepare a cost reconciliation report
How do you determine cost using the weighted-average method?
The proportions of products that a firm produces and sells.
What is the sales mix?
A managerial approach used to identify what activities have the greatest potential for improvement.
What is benchmarking?
A system which holds managers accountable for discrepancies between budgeted and actual cost/revenue.
What is responsibility accounting?