Chapter 03 - Cost Accounting and Performance Flashcards
What is job order costing
JIC is used in production of tailor made or unique goods,
What is processing costing
Units manufactured look the same. Cost accumulated by department. A method of allocating production cost to products and services by avg cost over total units produced.
What cause overhead applied
When actual OH applied is less than overhead applied
How do you account for abnormal spoilage and spoilage
Spoilage is inventoriable cost and abnormal spoilage is period cost
What is ABC?
refines product cost information because the cost system emphasizes long-term product analysis.
ABC normally results in:
substantially greater unit cost for low volume product than is reported by traditional product costing.
What is performance report?
Performance reports are much more specific short term include exceptional items that are controllable, user focus, specific time horizon
Pareto Diagram - Histogram
Display cumulative of frequency, of quality, issues defect or problems
Fish Bown Diagram
cause and effect diagram
Control Chart
determine 0 defect.
control charts show whether there is trend toward improved quality conformance or deterioration quality conformance.
Balance Score card
What are the critical success factors - FICA
Financial and non-financial features of an organization that bring success through strategy referred to as critical success factors see below
Financial - Profit Growth
Internal Business - Efficient production
Customer Satisfaction
Advances innovation and HR development
The balance scorecard provides information on several aspect of the org.
What is an appraisal cost ?
Part of Conformance Cost
Detect before it gets to the customer/next department
Appraisal would detect individual products that do not conform to specifications. Examples of Appraisal cost
Statistical quality checks
inspection
testing
maintenance of lab
What is prevention cost?
Part of Conformance cost
Employee training
inspections expense ( for RM coming in)
preventive maintenance
redesign product
redesign process
high quality suppliers
What is Benchmarking ?
Comparison points and is used for goals related to the specific success
What is driving ROE
NP Margin
Asset TO
Financial Leverage
