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21 Cards in this Set

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Cost Object
is any activity or item for which a separate measurement of cost is desired
Product Costs
Are the costs associated with making the product available and ready to sell

they are inventoriable costs
Period Costs
are selling and administration costs
Flow of Product Costs of Merchandise Inventory
Freight In, Invoice cost of Merchandise, and other costs to perpare merchandise for sale
Merchandise is split of into two things
Cost of Goods sold goes on the Income Statement

Ending Inventory goes on the balance sheet. That is goods not yet sold
What are the three types of Inventory?
Raw Material Inventory or Stores, Work-in-process Inventory, finished goods inventory
Manufacturing Overhead contains:
Indirect material, indirect labor, and other overhead costs
The flow of Product-Costs-Manufacturing Company
Beginning Direct Material Invetory
+Purchases
=Direct Materials Available for use
- Ending inventory
=Direct Materials Used
Raw Materials Purchases is what type of cost?
Raw Materials Purchases is a direct materials cost and is found in work in procress inventory
Raw Materials Inventory is what type of cost?
Raw Materials Inventory is a manufacturing overhead cost and is made up of indirect materials
What is the flow of raw materials?
Raw Materials purchases, to raw materials inventory, to ending raw materials inventory to the balance sheet
List all types of manufacturing overhead costs
1. Indirect Materials
2. Indirect Labor
3. Factory Rent
4. Depreciation
5. Factory Taxes
6. Factory Insurance
7. Other Factory costs
Work in Process Inventory is Made up of what?
Direct Materials, Direct Labor, and manufacturing overhead
Ending work in process ends up where?
The balance sheet
Finished Goods Inventory is split into two things what are they and where are they recorded?
Ending Finished goods inventory- Balance Sheet

Cost of goods sold-income statement
What are overhead costs?
-Indirect Supplies
-Indirect Labor
- Office Rent
-Depreciation
- Office Taxes
-Office Insurance
-Other Indirect Costs
What is a hybrid firm?
Companies that generate significant revenues from both services and products
How would you make a transaction for a raw material account?
Debit Raw Materials Inventory

Credit Accounts Payable
How would you make a transaction for direct materials that are transferred to production?
Debit Work-In-Process Inventory

Credit Raw Material Inventory
How would you make a transaction for direct labor cost incurred during a month?
Debit Work-In-Process Inventory

Credit Cast
Make a transaction if you paid 10,000 for overhead costs in cash and had a remainding balance of 100,000
Debit Work in Process Inventory for 110,000

Credit Cash of 10,000
Credit Accounts Payable of 100,000