Term
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Definition
| A costing method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overhead - in unit product costs. |
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Term
| Fixed Manufacturing Overhead Cost Deferred In Inventory |
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Definition
| The portion of the fixed manufacturing overhead cost of a period that goes into ending inventory under the absorption costing method. |
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Term
| Fixed Manufacturing Overhead Cost Released From Inventory |
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Definition
| The fixed manufacturing overhead cost of a prior period that becomes an expense of the current peroid under the absorption costing method. |
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Term
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Definition
| A costing method that includeds only variable manufacturing costs - direct materials, direct labor, and variable manufacturing overhead - in unit product cost. |
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Term
| What is the most widely used method of determining product costs? |
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Definition
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Term
| Absorption costing can artificially increase profits by....? |
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Definition
Increasint the quantity of units produced.
(208) |
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Term
| What 2 approaches are used in manufacturing compaies for costing products for the purposes of valuing invetories and cost of goods sold? |
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Definition
| Absorption costing and Variable costing |
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Term
| _____________ is usually used for external financial reports. |
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Definition
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Term
| _________________ preferred by some managers for internal decision making and must be used when an income statement is prepared in the contribution format. |
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Definition
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Term
| Ordinarily, absorption costing and variable costing produce different figures for ______ |
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Definition
| net operating income, and the differences can be quite large. |
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