ADMS 2510 Lecture Notes - Lecture 1: Income Statement, Irving Shipbuilding, Bauer Hockey

• School: York University
• Department: Administrative Studies
• Course: ADMS 2510
• Professor: Gajindra Maharaj

Document Summary

Chapter 2 cost terms, classifications, and concepts. Our initial focus in this chapter is on manufacturing companies, since their basic activities include most of the activities found in other types of business organizations. Objective 1: identify and give examples of each of the three basic manufacturing cost categories. Manufacturing costs are divided into three categories; Such minor items include the solder used to make electrical connections in a sony tv and the glue used in a pair of saucony running shoes. Materials such as solder and glue are called indirect materials and are included as part of manufacturing overhead, which is discussed later in this section. Indirect materials can still be thought of as raw materials, but they are not treated as direct materials because the costs of directly tracing them to the finished products exceed the benefits of doing so. Indirect labour includes the labour costs of janitors, supervisors, materials handlers, and security personnel.