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What is a cost accounting system?
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An accounting system for manufacturing activities based on the perpetual inventory system.
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What does overapplied overhead mean?
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The amount by which the overhead applied to production exceeds the actual overhead cost incurred in a period.
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17 Terms
1
What is a cost accounting system?
An accounting system for manufacturing activities based on the perpetual inventory system.
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2
What does overapplied overhead mean?
The amount by which the overhead applied to production exceeds the actual overhead cost incurred in a period.
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3
What is cost of goods sold (COGS)?
The cost of inventory sold to customers during a period; also called cost of sales.
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4
What is the predetermined overhead rate?
The rate established prior to the beginning of a period that divides estimated overhead cost by an estimated activity base, used to apply overhead cost to production.
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5
What are process operations?
Processing products in a continuous flow of steps; also called process manufacturing.
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6
What is finished goods inventory?
An account that controls finished goods files, recording costs of finished goods that are ready for sale.
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7
What is a receiving report?
A form used to report that ordered goods were received and to describe their quantity and condition.
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8
What is a job ?
Production of a customized product or service.
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9
What are subsidiary records ?
Job cost sheets that store job-specific cost data.
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10
What is a job cost sheet?
A separate record maintained for each job.
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11
What is target costing?
The maximum allowable cost for a product or service, defined as expected selling price less the desired profit.
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12
What is a job order costing system?
A cost accounting system to determine the cost of producing each job or job lot.
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13
What are time tickets used for?
To report the time an employee spent working on a job or on overhead activities.
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14
What are materials ledger cards?
Perpetual records updated each time materials are purchased or issued for production use.
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15
What is underapplied overhead?
The amount by which actual overhead cost incurred exceeds the overhead applied to production.
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16
What is a materials requisition?
A source document used by production managers to request materials for production.
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17
What is work in process inventory?
An account in which costs are accumulated for products that are being produced but are not yet complete.
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