ACCT208 Chapter Notes - Chapter 1-2: Lean Manufacturing, Management Accounting, Fixed Cost
7 Mar 2017
School
Department
Course
Professor
Document Summary
Reports to managers inside the organization for organization: planning, controlling, decision making, owners, creditors, tax authorities, regulators. Lean production (just in time) is a management approach that organizes resources such as people and machines around the flow of business processes and that only produces units in response to customer orders. Because lean thinking only allows production in response to customer orders, the number of units produced tends to equal the number of units sold, thereby resulting in minimal inventory. Q1) what are the 3 major elements of product costs in a manufacturing company: direct materials, direct labor, overhead. Product costs are costs related to dm, dl, and oh. Period costs are all others, selling, and administrative expenses. An activity base (cost driver) is a measure of whatever causes the incurrence of a variable cost. Q9) distinguish between discretionary fixed costs and committed fixed costs.
