ACCT 212 - Chapter 2 and 3 Study Guide

ACCT 212 - Chapter 2 and 3 Study Guide - Chapter 2 and 3...

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Chapter 2 and 3 Study Guide Period costs: all selling and administrative costs Product costs: direct materials direct labor and manufacturing overhead Opportunity costs: what someone gives up for something else Fixed costs: - committed: long-term, cannot be significantly reduced in the short term - discretionary: may be altered in the short term by the current managerial decisions Variable costs: costs that change Prime costs: direct material and labor Conversion costs: direct labor and manufacturing overhead Job order system: - many different products produced over period - products are manufactured to order - unique nature of each order requires tracing or allocating costs to each job and maintaining cost records for each job Process costing: traces and accumulates direct costs and allocates indirect costs of a manufacturing process
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Unformatted text preview: -materials: used to support production process-labor: wages paid to employees who are not directly involved in production work Schedule costs of goods manufactured:-direct materials, labor and manufacturing overhead-calculates cost of raw materials and direct labor used in production-calculates manufacturing costs associated with goods that were finished during the period Inventory cost flows: Costs Balance Sheet inventories Income statement expenses Material purchases Raw materials Direct Labor WIP Finished goods Cost of goods sold Manufacturing Overhead POHR calculation Closing over/under applied:-over: lower the cost of good sold-under: raise the cost of goods sold SALES Cost of goods sold = gross profit margin...
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