Key Terms VI Flashcards
Direct costing
Another term for variable costing
Fixed manufacturing overhead cost deferred in inventory
The portion of the fixed manufacturing overhead cost of a period that goes into inventory under the absorption costing method as a result of production exceeding sales
Fixed manufacturing overhead cost released from inventory
The portion of the fixed manufacturing overhead cost of a prior period that becomes an expense of the current period under the absorption costing method as a result of sales exceeding production
Just-in-time (JIT) methods
A production and inventory control system in which materials are purchases and units are produced only as needed to meet actual customer demand
Marginal costing
Another term for variable costing
Variable costing
A costing method that includes only variable manufacturing costs - direct materials, direct labour and variable manufacturing overhead - in the cost of a unit of product
