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Managerial Accounting
Managerial Accounting Equations
26
Accounting
Graduate
01/06/2011

Additional Accounting Flashcards

 


 

Cards

Term
Prime Cost =
Definition
= Direct Materials Cost + Direct Labor Cost
Term
Total Factory Cost or Manufacturing Cost =
Definition
Direct Materials + Direct Labor Cost + Factory Overhead
Term
Conversion Cost =
Definition
= Direct Labor Cost + Factory Overhead Cost
Term
Cost of Goods Manufactured (COGM) =
Or
Cost of Goods manufactured =
Definition
= Total Factory Cost + Opening Work in Process Inventory - Ending Work in Process Inventory
Or
= Direct materials cost + Direct labor cost + Factory overhead cost + Opening work in process inventory - Ending work in process inventory
Term
Cost of goods sold (COGS) =
Definition
= Cost of goods manufactured + Opening finished goods inventory - Ending finished goods inventory
Term
Number of units manufactured =
Definition
= Units sold + Ending Finished Goods units - Opening finished goods units
Term
Per unit cost of goods manufactured =
Definition
= Cost of goods manufactured / Units manufactured
Term
Materials used or consumed =
Definition
= Opening inventory or materials + Net purchases of materials - Ending inventory of materials
Term
Gross profit =
Definition
= Net sales - Cost of goods sold
Term
Operating profi =
Definition
= Gross profit - Operating expenses
Term
Operating or commercial expenses =
Definition
= Selling or marketing expenses + General or administrative expenses
Term
Per unit gross profit =
Definition
= Gross profit / No. of units sold
Term
Per unit gross profit =
Definition
= Gross profit / No. of units sold
Term
Per unit net profit =
Definition
= Net profit / No. of units sold
Term
Percentage of GP to sales =
Definition
= (Gross profit / Net sales) × 100
Term
Percentage of net profit to sales =
Definition
= (Net profit / Net sales) × 100
Term
Contribution margin =
Definition
= Sales - Variable expenses (manufacturing and nonmanufacturing)
Term
Net operating income =
Definition
= Contribution margin - Fixed expenses (manufacturing and non manufacturing)
Term
Contribution margin ratio =
Definition
= Contribution margin / Sales
Term
Break even point (units) =
Definition
= Fixed expenses / Unit contribution margin
Term
Break even point (dollar sales) =
Definition
= Fixed expenses / CM ratio
Term
Units sales to attain target profit =
Definition
= (Fixed expenses + Target profit) / Unit contribution margin
Term
Dollar sales to attain target profit =
Definition
= (Fixed expenses + Target profit) / Contribution margin ratio
Term
Margin of safety =
Definition
= Total budgeted or actual sales - Break even sales
Term
Margin of safety percentage or margin of safety ratio =
Definition
= Margin of safety / Total budgeted or actual sales
Term
Degree of operating leverage =
Definition
= Contribution margin / Net operating income
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