250_Notes_3B

250_Notes_3B - • Product costs = • Period costs = 3...

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ACCT 250 – ACCOUNTING FOR DECISION MAKING NOTES – CHAPTER 3A SPRING 2008 SUMMARY Here we examine the flow of materials (inventory) through the factory, the concept of product vs. period costs and calculation of COGM and COGS. NOTES 1) The flow of materials How the factory is organized a) A picture b) Three inventory accounts Raw materials inventory = Work in process (WIP) inventory = Finished goods inventory = a6860f608e1b2f47ce60ee046a75ba97b5543e0a.doc PAGE 1 OF 2
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ACCT 250 – ACCOUNTING FOR DECISION MAKING NOTES – CHAPTER 3A SPRING 2008 2) Product vs. period costs Yet another method of cost classification
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Unformatted text preview: • Product costs = • Period costs = 3) Cost of Goods Manufactured (COGM) • A schedule detailing all product costs incurred during a certain period of time a) Structure of the schedule – 2 groups of 3 • 3 types of product costs = • 3 types of inventory = o Only use the first 2 on this schedule b) An example… 4) Cost of Goods Sold (COGS) • A schedule of product costs incurred for the units sold during a period of time • COGM plus the change in Finished goods inventory • An example… a6860f608e1b2f47ce60ee046a75ba97b5543e0a.doc PAGE 2 OF 2...
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This note was uploaded on 04/18/2008 for the course ACCTG 250 taught by Professor Rabe during the Spring '08 term at Luther.

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250_Notes_3B - • Product costs = • Period costs = 3...

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