Cost Accounting Ch 2

Front 1

actual cost

Back 1

cost incured (a historical or past cost) as distinguished from a budgeted or forcasted cost

Front 2

average cost

Back 2

(or unit cost) cost computed by dividing total cost by the number of units

Front 3

budgeted cost

Back 3

predicted or forcasted cost (future cost) as distinguished from an acual or historical cost.

Front 4

conversion costs

Back 4

all manufacturing costs other than direct materials cost

Front 5

cost

Back 5

resource sacrificed or forgone to achieve a specific objective

Front 6

cost accumulation

Back 6

collection of cost data in some organized way by means of an accounting system

Front 7

cost allocation

Back 7

assighnment of indirect costs to a particular cost object

Front 8

cost assignment

Back 8

general term that emnompasses both tracing accumulated costs that have a direct relationship to a cost object and allocating accumulated costs that have an indirect relationship to a cost object

Front 9

cost driver

Back 9

a variable, such as the level of activity or voumet that casually affects costs over a given time span

Front 10

cost object

Back 10

anything for which a measurement of costs is desired

Front 11

cost of goods manufactred

Back 11

cost of goods brought to completion, whether they were started before or during the current accounting period

Front 12

cost tracing

Back 12

describes the assighment of direct costs to a particular cost object

Front 13

direct costs of a cost object

Back 13

costs related to the particular cost object that can be traced to the at object in an economically feasible (cost effective) way

Front 14

direct manufacturing labor costs

Back 14

include the compensation of all manufacturing labor that can be traced to the cost object (work in process and then finished goods) in an economically feasible way

Front 15

direct material costs

Back 15

Acquisition of costs of all materials that eventually becom part of the cost object (work in process and then finished goods) and that can be traced to the cost object in an economically feasible way

Front 16

direct material inventory

Back 16

direct materials in stock and awaiting use in the manufacturing process

Front 17

factory overhead costs

Back 17

(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 object in an economically feasible way.

Front 18

finished goods inventory

Back 18

goods completed but not yet sold

Front 19

fixed cost

Back 19

cost that remains unchanged in total for a given time period despite wide changes in the related activity in total activity or volume

Front 20

idle time

Back 20

wages paid for unproductive time caused by lack of orders, machine breakdowns, material shortages, poor scheduling and the like

Front 21

indirect costs of a cost object

Back 21

costs related to the particular cost object that cannot be traced to that object in an economically feasible way

Front 22

indirect manufacturing costs

Back 22

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 (also called manufacturing overhead costs and factory overhead costs)

Front 23

inventoriable costs

Back 23

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

Front 24

manufacturing overhead costs

Back 24

(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

Front 25

manufactring sector companies

Back 25

companies that purchase materials and componets and convert them into various finished goods

Front 26

merchandising sector companies

Back 26

Companies that purchase and then sell tangible products without changing their basic form

Front 27

operating income

Back 27

total revenues from operations minus cost of goods sold and operating costs (excluding interest expense and income taxes)

Front 28

overtime premium

Back 28

Wage rate paid to workers (for both direct labor and indirect labor) in excess of their straightime rates)

Front 29

period costs

Back 29

all costs in the income statemnt other than costs of goods sold

Front 30

prime costs

Back 30

all direct manufacturing costs

Front 31

product cost

Back 31

sum of the costs assigned to a product for a specific purpose

Front 32

relevant range

Back 32

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

Front 33

revenues

Back 33

inflows of assets (usually cash or accounts receivable) received for products or services provided to customers

Front 34

service sector companies

Back 34

companies that provide services or ingtangible products to their customers

Front 35

unit cost

Back 35

cost computed by dividing total cost by the number of units (also called average cost)

Front 36

variable cost

Back 36

cost that changes in total in proportion to changes in the related level of total activity or volume

Front 37

work in process inventory

Back 37

goods partially worked but not yet completed