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20 Cards in this Set
- Front
- Back
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Allocation |
The process of finding a logical method of assigning overhead cost to the products or services at company produces or provides |
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Cost drivers |
Factors that cause, or drive, then currents of costs |
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Cost pools |
Groups of overhead costs that are similar, used to simplify the task of assigning cost to products using ABC costing |
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Direct method |
A method of allocating service department costs that allocates costs directly to production departments |
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Equivalent units |
The number of finished units that can be made from the materials, labor, and overhead included in partially completed units. |
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French benefits |
Payroll costs in addition to basic hourly wage |
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Job costing |
I costing system that accumulates, tracks, and assigns cost for each job produced by a company. |
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Normal costing |
A method of costing using an estimate of overhead and predetermined overhead rates in stead of the actual amount of overhead. |
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Operations costing |
A hybrid of job and process costing; used by companies that make products in batches. |
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Overapplied overhead |
The amount of applied overhead in excess of actual overhead |
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Predetermined overhead rates |
Used to apply over head to product; calculated by dividing the estimated overhead for a cost pool by the estimated units of cost driver |
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Process costing |
I costing system that accumulates and tracks cost for each process performed and then assigns those costs equally to each unit produced |
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Step down or sequential method |
Recognizes that service departments consume resources of other service departments and allocates those costs to other service departments and then to production departments in a sequential fashion |
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Underapplied overhead |
The amount of actual overhead in excess of applied overhead |
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Activities |
Procedures or processes that cause work to be accomplished |
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Activity based costing (ABC) |
A system of allocating overhead cost that assumes that activities, not volume of production, cause overhead cost to be incurred. |
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Batch-level cost |
Cost that are incurred each time a batch of goods is produced |
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Facility level costs |
Cost that are incurred to sustain the overall manufacturing process |
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Product level costs |
Cost that are incurred as needed to support the production of each type of product |
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Unit level costs |
Cost that are incurred each time a the unit is produced. |
