ACCT30210 Lecture Notes - Lecture 6: Peanut Butter
Document Summary
So as one goes up, the other one goes down. Chapter 4 - important example problem in notebook (cogs t-accounts) (based on teaching notes chapter 4 from sakai) How to make two revenue equal, between actual costs and revenue and estimated allocation costs and revenue. Make the costs of making the snowboards higher than it should have been because we allocated more or less than we should have because we"ve been estimating. So make the proper adjustments where estimation is different than actual. Example: like how you spread peanut butter evenly on a sandwich. Do this so you don"t penalize a particular period when allocating when it"s too high or too low. Allocation rate: budgeted manufacturing overhead cost / budgeted direct manufacturing labor cost. When have under-allocated moh, add under-allocated amount to. Normal costing: baby (combination of the first 2)
