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32 Cards in this Set
- Front
- Back
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Journal entry for Applied OH |
Debit WIP Credit FOH |
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Journal entry for OVERAPPLIED |
Debit FOH XXX Credit COGS XXX |
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Journal Entry for UNDERAPPLIED |
Debit COGS XXX Credit FOH XXX |
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Journal Entry for Purchases of Raw Materials |
Debit RM xxx Credit AP xxx |
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J/E for issuance direct and indirect materials |
Debit WIP xxx Debit MOH xxx Credit RM xxx |
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J/E for recording of labor costs (both DL and InDL) |
Debit WIP Debit OH Credit Salaries and wages payable
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J/E for recording Actual OH |
Debit MOH Credit (any payable accounts) |
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J/E for Applying MOH |
Debit WIP Credit MOH |
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J/E for transfer of completed units |
Debit FG Credit WIP |
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J/E for transferring units sold |
Debit COGS Credit FG Debit AR Credit Sales |
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Predetermined OH rate formula |
Estimated OH / Estimated DLH |
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Applied OH formula |
Predetermined OH x Actual Activity |
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Cost function |
y = a + b(x) |
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Y = |
Total costs (mixed) |
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a = |
Total fixed Costs |
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b = |
Variable cost per unit |
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x = |
number of units or some activity |
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Product Cost |
DM + DL + MOH |
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Period Cost |
Selling expenses + administrative expenses |
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Conversion Cost |
DL + MOH |
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Prime Cost |
DM + DL |
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Fixed costs per unit |
Rise as activity level declines, declines as activity level rises |
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Total Fixed Costs |
Remain the same whether production is increased or decreased |
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Product costs include |
DM, DL, OH costs |
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Product cost |
associated with "factory", they go to balance sheet initially as inventory assets, but then they will be expensed on income statement as "COGS" |
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Period Costs |
nonmanufacturing costs "office", they land straight on the income statement as an expense. THEY ARE NOT TO BE RECORDED AS "COGS" |
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High Low method formula |
(high cost - low cost) / (high act lvl - low act lvl) |
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Traditional Format (GAAP) |
based on FUNCTION, not cost behavior |
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Traditional Format formula |
Sales - COGS = GROSS MARGIN Gross Margin - (selling, general, admin expenses)= net operating income |
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Contribution Format (NON-GAAP) |
Used to measure COST BEHAVIOR, not function |
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Contribution Format formula |
Sales - variable costs = Contribution margin Contribution margin - fixed costs = net op income |
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Net operating income |
Sales - COGS - Selling and admin expenses |
