Managerial Accounting Chapter 4

Front 1

Processing Department

Back 1

an organizational unit where work is performed on a product and where materials, labor, or overhead costs are added to the product.

Front 2

2 essential features of processing departments

Back 2

1. Activity in the department is performed uniformly on all units.
2.The output of the processing department is homogeneous.

Front 3

equivalent Units

Back 3

Number of Partially completed units X Percent Completion

Front 4

Equivalent Units definition

Back 4

Number of complete units that could have been obtained from the materials and effort that went into the partially complete units.

Front 5

Weighted average method

Back 5

blends together units and costs from the current period with units and costs from the prior period

Front 6

Equivalent Units of Production definition

Back 6

the units transferred to the next department during the period plus the equivalent units in the departments ending work in process inventory

Front 7

Equivalent Units of Production =

Back 7

Units Transferred to the next dept or to finished goods + equivalent units in ending work in process inventory

Front 8

Conversion Cost

Back 8

the direct labor cost plus manufacturing overhead cost

Front 9

Cost Per Equivalent Unit

Back 9

(Cost of beginning work in process + cost added during the period)
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Equivalent units of production