ACCT208 Study Guide - Final Guide: Financial Statement, Management Accounting, Finished Good
27 Jun 2018
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PRACTICE EXAM NOTES --
Test 1 Chapters 1, 2, 3, and 7
Take notes on --
Actual / applied overhead
Beginning WIP (#15
Ending FG (#17
Objectives of Management Accounting
● Has primary emphasis on the future
● Provide information for costing of services, products, and other objectives of interest to management
● Provide information for planning, controlling, evaluating and continuous improvement
● Provide information for decision making
→ NOT preparing external reports for investors, government agencies and other outside users
“Just in Time” (JIT) Model
● Create a pull system that responds to customer orders
● Cross train employees to both work on the product and inspect it
● Organize workstations around the production of a major component of the product
One consequence of a change from a Traditional to a properly implemented Just In Time Production system can be --
a more motivated workforce
Although depreciation is always a period cost (or operating cost) in a merchandising firm, it can be a product cost in a
manufacturing firm
Costs of Direct Materials
● Product cost
○ Direct Materials
○ Direct Labor
○ Overhead
● Prime cost
Job Costing -- Unit Cost = total Product Cost divided by the number of units produced
COGM = Product Cost of Goods completed during the current period
Product Costs are expensed when the product is sold
Which is not true:
● Actual overhead costs always enter the Work in Progress “WIP” account
● Cost of a job includes DM, DL, Applied OH
Document Summary
Test 1 chapters 1, 2, 3, and 7. Provide information for costing of services, products, and other objectives of interest to management. Provide information for planning, controlling, evaluating and continuous improvement. Not preparing external reports for investors, government agencies and other outside users. Create a pull system that responds to customer orders. Cross train employees to both work on the product and inspect it. Organize workstations around the production of a major component of the product. One consequence of a change from a traditional to a properly implemented just in time production system can be -- a more motivated workforce. Although depreciation is always a period cost (or operating cost) in a merchandising firm, it can be a product cost in a manufacturing firm. Job costing -- unit cost = total product cost divided by the number of units produced. Cogm = product cost of goods completed during the current period. Product costs are expensed when the product is sold.
