Chapter 1 Flashcards
Managerial Accounting
vs
Financial Accounting
Management Functions
- Planning
- Directing
- Controlling
Manufacturing Costs
“Herstellungskosten”
- Direct Materials
- Direct Labor
- Manufacturing Overhead
Raw Materials
- Basic materials and parts used in the manufacturing process
Direct Materials
“Materialeinzelkosten”
- Raw Materials that can be physically and directly associated with the finished product during the manufacturing process
Indirect Materials
- Considered part of manufacturing overhead
- NOT physically a part of the finished product or
- or impractical to trace to the finished product
Direct Labor
“Fertigungseinzelkosten”
- Work of a factory employee that can be physically and directly associated with cnverting raw materials into finished goods
- Direct Labor cost vom Time Ticket ablesen!!!
Indirect Labor
- NO physical association with the finished product
- or impractical to trace
Manufactoring Overhead
“Gemeinkosten”
- Costs that are indirectly associated with manufactoring the finished product
- Includes all MANUFACTORING COSTS expect direct materials and direct labor
- Im “Manufacturing Overhead Account” werden alle Kosten zusammengefasst (Inventory Account)
- NO admincost !!!!!!
Also called:
factory overhead, indirect manufacturing cost or burden
Product Costs
- Components: (-> “Produktionskosten”)
- Direct Materials
- Direct Labor
- Manufactoring Overhead
- Direct Materials
- Costs that are an integral part of production
- Recorded in the “inventory” account
- Not an expense (COGS) until the good is sold
Period Costs
- Non-Manufactoring costs
- Includes all selling and administrative expenses
- “Vertriebs- und Verwaltungskosten”
- Charged to expenses as incurred
Income Statement and COGS
Merchandiser vs. Manfacturer
Manufacturing Costs are reported in the income statement as an expense, once the manufactured item has been sold
Cost of Goods Manufactured
Beginning Work in Process Inventroy
+ Total Manufacturing Costs
(= Total Cost of Work in Process)
- Ending Work in Process Inventory
_________________________________
= Cost of Goods Manufactured
Total Manufacturing Costs
= Direct Materials + Direct Labor + Manfacturing Overhead
Direct Materials bzw. Direct Materials Used
= Raw Materials Inventory t=0
+ Raw Materials Purchased
- Raw Materials Inventory t=1