ACCTG 102 Lecture Notes - Lecture 27: Income Statement, Cost Accounting, Financial Statement
Document Summary
Direct materials- resources in stock and available for use. Work in process- goods partially worked on but not yet completed. Finished goods- goods completed but not yet sold. Inventoriable costs are all costs of a product that are considered assets in a company"s balance sheet when the costs are incurred and that are expensed as cost of goods sold only when the product is sold. For manufacturing companies, all manufacturing costs are inventoriable costs. Period costs are all cost in the income statement other than cost of goods sold. They are treated as expenses of the accounting period in which they are incurred. The cogm and the cogs of the income statement are accounting representations of the actual flow of costs through a production system. Prime cost is a term referring to all direct manufacturing costs- material and labor. Conversation cost is a term referring to direct labor and indirect manufacturing.
