Untitled Flashcards Set

COGM

Cost of Goods Manufactured, calculated as Total Manufacturing Costs + Beginning WIP Inventory - Ending WIP Inventory.

Total Manufacturing Costs

Sum of Direct Materials Used, Direct Labor, and Manufacturing Overhead.

Direct Materials Used

Calculated as Raw Materials Purchased + Beginning Raw Materials Inventory - Ending Raw Materials Inventory.

COGS

Cost of Goods Sold, calculated as Beginning Finished Goods Inventory + COGM - Ending Finished Goods Inventory.

POHR

Predetermined Overhead Rate, calculated as Estimated Total Manufacturing Overhead divided by Estimated Total Activity Base.

Applied Overhead

Calculated as POHR multiplied by Actual Activity Base.

Variable Cost per Unit

Calculated as (High Cost - Low Cost) divided by (High Activity - Low Activity).

Fixed Cost

Calculated as Total Cost at High Level minus (Variable Cost per Unit multiplied by High Activity).

Total Cost (Y) Formula

Total Cost (Y) = Fixed Cost (FC) + (Variable Cost per Unit multiplied by Activity Level).

Contribution Margin (CM)

Calculated as Sales Revenue minus Variable Costs.

CM Ratio

Contribution Margin divided by Sales Revenue.

Break-Even Point (Units)

Fixed Costs divided by Contribution Margin per Unit.

Break-Even Sales ($)

Fixed Costs divided by Contribution Margin Ratio.

Required Sales (Units)

Calculated as (Fixed Costs + Target Net Income) divided by Contribution Margin per Unit.

Required Sales ($)

Calculated as (Fixed Costs + Target Net Income) divided by Contribution Margin Ratio.

Margin of Safety ($)

Calculated as Actual Sales minus Break-Even Sales.

Margin of Safety Ratio

Calculated as Margin of Safety ($) divided by Actual Sales ($).

Weighted Average CM per Unit

Calculated as Σ (CM per Unit multiplied by Sales Mix %) divided by Total Units.