Ch1pt2 Flashcards
Common business sectors
- Service companies
- Merchandising companies
- Manufacturing companies
Cost classifications
Behavior
traceability
controllability
relevance
function
How a cost changes with activity
Behavior
Can it be easily and economically trace to a single cost object
Traceability
Responsibility level
Controllability
Sunk cost or out of pocket
Relevance
Capitalization as inventory or expensed as incurred
Function
All activities associated with making a product/providing a service
Value chain
Value chain
Research and development
design
production
marketing and sales
distribution
customer support
Beginning WIP + Direct materials + direct labor + manufacturing overhead -ending WIP = finished goods
Cost of goods manufactured
Beginning to finish goods + completed goods - and then finished goods =COGS
Cost of goods sold
Direct materials
Product
Direct labor
Product
Manufacturing overhead
Product
Direct materials and direct labor
Prime cost
Direct labor and manufacturing overhead
Conversion costs
Selling costs
Period
General & administrative costs
Period
Raw materials inventory
work in process inventory
finished goods inventory
Manufacturing companies
