Chapter 16 Definitions

Front 1

1. Conversion costs per equivalent unit

Back 1

the combined costs of direct labor and factory overhead per equivalent unit.

Front 2

2. Cost of goods manufactured

Back 2

total manufacturing costs (direct materials, direct labor, and factory overhead) for the period plus beginning goods in process less ending goods in process; also called net cost of goods manufactured and cost of goods completed.

Front 3

3. Equivalent units of production (EUP)

Back 3

number of units that would be completed if all effort during a period had been applied to units that were started and finished.

Front 4

4. FIFO method

Back 4

method to assign cost to inventory that assumes items are sold in the order acquired; earliest items purchased are the first sold.

Front 5

5. Job order cost accounting system

Back 5

cost accounting system to determine the cost of producing each job or job lot.

Front 6

6. Materials consumption report

Back 6

document that summarizes the materials a department uses during a reporting period; replaces materials requisitions.

Front 7

7. Process cost accounting system

Back 7

system of assigning direct materials, direct labor, and overhead to specific processes; total costs associated with each process are then divided by the number of units passing through that process to determine the cost per equivalent unit.

Front 8

8. Process cost summary

Back 8

report of costs charged in a department, its equivalent units of production achieved, and the costs assigned to its output.

Front 9

9. Process operations

Back 9

processing of products in a continuous (sequential) flow of steps; also called process manufacturing or process production.

Front 10

10. Weighted average method

Back 10

method to assign inventory cost to sales; the cost of available for sale units is divided by the number of units available to determine per unit cost prior to each sale that is then multiplied by the units sold to yield the cost of that sale.