Managerial Accounting - Chapter 2
A measure of an organization's output of goods or services.
average cost per unit
The total cost of producing a particular quantity of product divided by the number of units produced.
A cost that is subject to the control or substantial influence of a particular individual.
Direct-labor cost plus manufacturing-overhead cost.
The sacrifice made, usually measured by the resources given up, to achieve a particular purpose.
A characteristic of an activity or event that results in the incurrence of costs by that activity or event.
Responsibility centers, products, or services to which costs are assigned.
cost of goods manufactured
The total cost of direct material, direct labor, and manufacturing overhead transferred from Work-in- Process Inventory to Finished-Goods Inventory during an accounting period.
cost of goods sold
The expense measured by the cost of the finished goods sold during a period of time.
The difference in a cost item under two decision alternatives.
A cost that can be traced to a particular department or other subunit of an organization.
The cost of salaries, wages, and fringe benefits for personnel who work directly on the manufactured products.
Raw material that is physically incorporated in the finished product.
The consumption of assets for the purpose of generating revenue.
Completed products awaiting sale.
A cost that does not change in total as activity changes.
Unproductive time spent by employees due to factors beyond their control, such as power outages and machine breakdowns.
The increase in cost from one alternative to another.
A cost that cannot be traced to a particular department.
All costs of compensating employees who do not work directly on the firm's product but who are necessary for production to occur.
Materials that either are required for the production process to occur but do not become an integral part of the finished product, or are consumed in production but are insignificant in cost.
Cost incurred to purchase or manufacture goods. Also see product cost.
All manufacturing costs other than direct-material and direct-labor costs.
The extra cost incurred in producing one additional unit of output.
A manufacturing environment in which many standardized components are combined to produce custom-made products to customer order.
The costs incurred to produce and sell services, such as transportation, repair, financial, or medical services.
The potential benefit given up when the choice of one action precludes selection of a different action.
Costs incurred that require the expenditure of cash or other assets.
The extra compensation paid to an employee who works beyond the normal period of time.
Costs that are expensed during the time period in which they are incurred.
The costs of direct material and direct labor.
Cost associated with goods for sale until the time period during which the products are sold, at which time the costs become expenses. See also inventoriable cost.
Material entered into a manufacturing process.
schedule of cost of goods manufactured
A detailed schedule showing the manufacturing costs incurred during an accounting period and the change in work-in-process inventory.
schedule of cost of goods sold
A detailed schedule showing the cost of goods sold and the change in finished-goods inventory during an accounting period.
service (or support) departments
Subunits in an organization that are not involved directly in producing the organization's output of goods or services.
Costs that were incurred in the past and cannot be altered by any current or future decision.
A cost that changes in total in direct proportion to a change in an organization's activity.
work in process
Partially completed products that are not yet ready for sale.