| Term | Definition |
|---|
| Actual Cost | cost incurred (a historical or past cost), as distinguished from a budgeted or forecasted cost |
| Average Cost | another term for unit cost |
| Budgeted Cost | predicted or forecasted cost (future cost) as distinguished from an actual or historical cost |
| Conversion Costs | all manufacturing costs other than direct materials costs |
| Cost | resource sacrificed or foregone to achieve a specific objective |
| Cost Accumulation | collection of cost data in some organized way by means of an accounting system |
| Cost Allocation | assignment of indirect costs to a particular cost object |
| Cost Assignment | general term that encompasses both (1) tracing accumulated costs that have a direct relationship to a cost object and (2) allocated accumulated costs that have an indirect relationship to a cost object |
| Cost Driver | a variable, such as the level of activity or volume, that casually affects costs over a given time span |
| Cost Object | anything for which a measurement of costs is desired |
| Cost of Goods Manufactured | costs of goods brought to completion, whether they were started before or during the current accounting period |
| Cost Tracing | describes the assignment of direct costs to a particular cost object |
| Direct Costs of a Cost Object | costs related to the particular cost object that can be traced to that object in an economically feasible way |
| Direct Manufacturing Labor Costs | include the compensation of all manufacturing labor that can be traced to the cost object (WIP then FGs) in an economically feasible way |
| Direct Material Costs | acquisition costs of all materials that eventually become part of the cost object (work in process and then finished goods) in an economically feasible way |
| Direct Materials Inventory | direct materials in stock and awaiting use in the manufacturing process |
| Factory Overhead Costs | another term for indirect manufacturing costs |
| Finished-goods Inventory | goods completed but not yet sold |
| Fixed Costs | costs that remain unchanged in total for a given time period, despite wide changes in the related level of total activity or volume |
| Idle Time | wages paid for unproductive time caused by lack of orders, machine breakdowns, material shortages, poor scheduling, and the like |
| Indirect Costs of a Cost Object | costs related to the particular cost object that cannot be traced to that object in an economically feasible way |
| Indirect Manufacturing Costs | all manufacturing costs that are related to the cost object (work in process and then finished goods) but that cannot be traced to that cost object in an economically feasible way |
| Inventoriable Costs | all costs of a product that are considered as assets in the balance sheet when they are incurred and that become cost of goods sold only when the product is sold |
| Manufacturing Overhead Costs | another term for indirect manufacturing costs |
| Manufacturing-sector Companies | companies that purchase materials and components and convert them into various finished goods |
| Merchandising-sector Companies | companies that purchase and then sell tangible products without changing their basic form |
| Operating Income | total revenues from operations minus cost of goods sold and operating costs (excluding interest expense and income taxes) |
| Overtime Premium | wage rate paid to workers (for both direct labor and indirect labor) in excess of their straight time wage rates |
| Period Costs | all costs in the income statement other than cost of goods sold |
| Prime Costs | all direct manufacturing costs |
| Product Costs | sum of the costs assigned to a product for a specific purpose |
| Relevant Range | band of normal activity level or volume in which there is a specific relationship between the level of activity or volume and the cost in question |
| Revenues | inflows of assets (usually cash or accounts receivable) received for products or services provided to customers |
| Service-sector Companies | companies that provide services or intangible products to their customers |
| Unit Cost | cost computed by dividing total cost by the number of units |
| Variable Cost | cost that changes in total in proportion to changes in the related level of total activity or volume |
| Work-in-Process Inventory | goods partially worked on but not yet completed |
| Work in Progress | another term for work-in-process |
Combine with other sets
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