Chapter 5 Flashcards
intangibilitiy
the nonphysical nature of services as opposed to products
inseparability
production and consumption are inseparable for services
Heterogeneity
the greater changes for variation in the performance of services than in the production of products
perishability
services cannot be inventoried, but must be consumed when performed
operation costing
a hybrid of job order and process costing
cost accumulation
the recognition and recording of costs
cost measurement
involves determining the dollar amounts of direct materials, direct labor, and overhead used in production
cost assignment
the association of production costs with the units produced
source document
describes a transaction
actual cost system
uses actual costs for direct materials, direct labor, and overhead to determine unit cost
normal costing system
measures overhead costs on a predetermined basis and uses actual costs for direct materials and direct labor
expected activity level
the production level the firm expects to attain for the coming year
normal activity level
average activity usage that a firm experiences in the long term
predetermined overhead rate
those rates corresponding to the theoretical and practical levels
theoretical activity level
the absolute maximum production activity of a manufacturing firm
practical activity level
the maximum output that can be realized if everything operates efficiently
job order costing system
costs are accumulated by job
job order cost sheet
the document that identifies each job and accumulates its manufacturing costs
work in process inventory file
the collection of all job cost sheets
materials requisition form
the cost of direct materials is assigned to a job by use of a source document known as this
time ticket
direct labor is assigned to each particular job by this
normal cost of goods sold
cost of goods sold before a overhead variance adjustment
adjusted cost of goods sold
cost of goods sold after a variance for overhead adjustment has been made
closing the overhead to cost of goods sold is done
at the end of the year
normal spoilage
the expected part of products manufactured that will be defective
abnormal spoilage
the part of defective products that come from a specific job
