Business 101- Managerial Accounting Chapters 1 and 2
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Created by:
richeyd217 on February 26, 2012
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16 terms
Terms | Definitions |
|---|---|
 I. Basic Schedule | Beginning Materials + Purchases = Available - Ending Materials = Direct Materials |
| II. Total Manufacturing Costs | Direct Materials + Direct Labor + Factory Overhead = Total Manufacturing Costs |
| III. Cost of Goods Manufactured | Beginning Work in Process + Total Manufacturing Costs = Available - Ending Work in Process = Cost of Goods Manufactured |
| IV. Cost of Goods Sold | Beginning Finished Goods + Cost of Goods Manufactured = Available - Ending Finished Goods = Cost of Goods Sold |
| V. Income Statement | Sales Revenue - Cost of Goods Sold = Gross Profit - Operating Expenses = Net Income |
| Prime Cost Elements | Direct Materials and Direct Labor |
| Conversion Cost Elements | Direct Labor and Factory Overhead |
| "Inventorial costs"- Costs that are necessary to produce finished product; recorded as inventory (assets) until sold, then recorded as cost of goods sold (expensed) | Product Costs |
| "Noninventorial costs"- nonmanufacturing costs; expensed as incurred and matched with a revenue of a particular time period | Period Costs |
| Method of allocating overhead based on each product's use of activities in making the product | Activity-Based Costing |
| Performance-measurement approach that uses both financial and non-financial measures, tied to company objectives, to evaluate a company's operations in an integrated fashion | Balanced Scorecard |
| Software that provides a comprehensive, centralized, integrated source of infomation to manage all major business processes | Enterprise Resource Planning system |
| Inventory system in which goods are manufactured or purchases just in time for sale | Just-in-Time Inventory |
| Specific approach used to identify and manage constraints in order to achieve the company's goals | Theory of Constraints |
| Systems implemented to reduce defects in finished products with the goal of achieving zero defects | Total quality management |
| All activities associated with providing a product or service | value chain |
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