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33 Cards in this Set
- Front
- Back
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Serivice Companies
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provide intangible services-such as healthcare, insurance, banking, and consulting, rather than selling products
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Merchandising companies
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sell products in the same form as purchased and have only one class of inventory:merchandise inventory
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Raw Materials Inventory
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has teh materials used to make a product
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Work In Process Inventory
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consists of units of product that are only partially complete and will require further work before they are ready for sale to a customer.
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Finished Goods Inventory
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consists of units of product that have been completed but have not been sold to customers
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Value Chain
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are the activities that add value to the company's products are services
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Research and Development
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new or improved products or services
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Design
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is detailed engineering of products and services and the processes for producing them
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Production or Purchases
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are resources used to produce a product or service or to purchase a finished product intended after the resale
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Marketing
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is promotion and advertising of products or services
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Distribution
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is delivery of products or services to customers
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Customer Service
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is support provided for customers after the sale
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Cost Object
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is anything for which managers want a separate measurement of cost
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Total costs
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Include the cost all resources used throughout the value chain
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Direct Costs
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can be easily and conveniently traced to specific products
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Direct Materials
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are materials that become part of the finished product
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Direct Labor
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costs include all labor cost for specific work performed on products
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Indirect Costs
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cannot easily and conveniently traced to specific products
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Manufacturing Overhead includes
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Indirect materials, indirect labor, and other indirect costs
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Prime Cost Equation
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Prime Costs=Direct Materials+Direct Labor
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Conversion Costs equation
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Conversion Costs=Direct Labor+Manufacturing Overhead
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Marketing or Selling Costs
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include all costs necessary to secure customer orders and get the finished product or service into the hands of the customer
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Administrative costs
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include all executive, organizational, and clerical costs associated with the general management of an organization rather than associated with manufacturing, marketing, or selling.
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Period Costs
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are those costs that tare matched against revenues on a time period basis
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Product Costs
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when incurred are assigned to units produced and subsequently are expensed when sold
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Controllable Cost
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are ones a manger can influence or change over a specified time period
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Relevant
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decision information includes future cost, revenue, or resource usage data that will be different for the various alternative being evaluated and that will have a bearing on which alternative the manager selects
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Sunk Cost
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is one that has already been incurred-a past cost
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Fixed cost
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remain constant, in total regardless of changed in the level of activity within the relevant range
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Relevant Range
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is the range of activity in which activity is most likely occurring
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Fixed Cost per unit
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react inversely with changes in activity
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Variable Costs
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are cost that change, in total, in direct proportion to changes in the level of activity within the relevant range
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Variable cost per unit
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is a constant
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