New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

ACG 203, UNCW, Ch 4-6 for Exam 2

by: Emily Rose

ACG 203, UNCW, Ch 4-6 for Exam 2 203

Marketplace > University of North Carolina - Wilmington > Accounting > 203 > ACG 203 UNCW Ch 4 6 for Exam 2
Emily Rose
View Full Document for 0 Karma

View Full Document


Unlock These Notes for FREE

Enter your email below and we will instantly email you these Notes for Managerial Accounting I

(Limited time offer)

Unlock Notes

Already have a StudySoup account? Login here

Unlock FREE Class Notes

Enter your email below to receive Managerial Accounting I notes

Everyone needs better class notes. Enter your email and we will send you notes for this class for free.

Unlock FREE notes

About this Document

These notes go over material from chapters 4-6, for the second exam
Managerial Accounting I
Joseph Betts
Class Notes
ACG, Managerial, Accounting, uncw, Betts, 203




Popular in Managerial Accounting I

Popular in Accounting

This 1 page Class Notes was uploaded by Emily Rose on Wednesday March 2, 2016. The Class Notes belongs to 203 at University of North Carolina - Wilmington taught by Joseph Betts in Spring 2016. Since its upload, it has received 13 views. For similar materials see Managerial Accounting I in Accounting at University of North Carolina - Wilmington.


Reviews for ACG 203, UNCW, Ch 4-6 for Exam 2


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 03/02/16
Process Costing­ Ch 4 MO                      |xx  operating income Conversion Cost­ Direct labor cost plus manufacturing overhead cost WIP  xx| Incremental analysis­ An analytical approach that focuses only on those  Equivalent units­ The product of the number of partially completed units  WIP xx| costs and revenues that change as a result of a decision.  and their percentage of completion with respect to a particular cost.  Transfer to Dept B  xx| Margin of Safety­ The excess of budgeted or actual dollar sales over the  Equivalent units are the number of complete whole units that could be  From Dept A     |xx break­even dollar sales  FG xx| obtained from the materials and efforts contained in partially completed  Operating Leverage­ A measure of how sensitive net operating income is  units WIP B     |xx to a given percentage percentage change in dollar sales  Equivalent Units of Production­ (weighted­average method) The units  COGS xx| Sales Mix­ The relative proportions in which a company’s products are  transferred to the next department (or to finished goods) during the period  FG    |xx sold. Sales mix is computed by expressing the sales of each product as a  plus the equivalent units in the department’s ending work in process  ­Equivalent units of production­ The number of partially completed units  percentage of total sales inventory Target Profit Analysis­ Estimating what sales volume is needed to achieve Operation Costing­ A hybrid costing system used when products have  and the percentage completion of those units a specific target profit some common characteristics and some individual characteristics ­These partially completed units complicate the determination of a depths   Variable expense ratio­ A ratio computed by dividing variable expenses  output for a given prd. and the unit cost that should be assigned to that  Process Costing­ A costing method used when essentially homogeneous  output by dollar sales products are produced on a continuous basis, possesses attributes of both  approaches ­10,000 units 70% complete= 7,000 units complete CVP Analysis­ assumptions­ selling P is constant, costs are linear and can  Processing Department­ An organizational unit where work is performed  10,000 units complete + (5,000 IP x.30 (%))= 11,500 accurately be divided into variable and fixed, sales mix is constant,  on a product and where materials, labor or overhead costs are added to the  *Two half completed units are equivalent to one completed unit 2 methods­ FIFO and Weighted average method inventories do not change (MANUF comp) (units produced=units sold) product; any unit where any 3 items are added to the product; activities  ­use weighted avg. method to find equivalent units of production, makes no  Contribution Income Statement­ helpful to mgrs. In judging impact on  performed uniformly (homogenous)  profits of changes in selling P, cost or Volume, emphasis on cost behav. Weighted­average method­ A process costing method that blends together distinction between work done in prior/current periods CM­ amount remaining from sales rev after VC have been deducted units and costs from both the current and prior periods ­Treatment of DL graph­> dollar amount vs. type of product cost chart (DL  CVP Relationships­ Profit = (Sales – VC) – FC  and MO combined to be called conversion cost), can be 100% done as far  ­4 charts­ equivalent units of product, process costing (1 dept) as the DM go, but only 50% (some percentage) done with DL and MO.  Profit= (P x Q – V x Q) – FC  Departments­ WIP ­Materials vs . Conversion Costs (DL+MO) CVP­ volume X­axis, dollars on Y­axis ­Flow: Raw materials (RM) ­> A, B, C, D > (Depts) WIP ­> FG ­> CGS CM Ratio= CM per unit / SP per unit = $200/$500 = 40% 3 things in each department: DL, DM, MO  ­Equivalent units of production= units completed and transferred +  Dollar Sales to BE = FE/ CM Ratio equivalent units remaining in WIP Degree of Operating Leverage= CM/ NOI *Similarities Between Job­Order and Process Costing: ­Cost Per equivalent unit = (Cost of Beginning WIP Inventory + Cost added ­Same accounts­ M, OH, L (flow of costs) during the period) / Equivalent units of production Margin of Safety= Total Sales – BE Sales ­same manufacturing accts­ MO, RM, WiP, FG Ch. 6 ­Process costing is when a single product is produced over and over again ex. Materials & Conversion, Compute and Apply costs  Absorption costing­ A costing method that includes all manufacturing  ­Department is where we add materials, labor and overhead to the product $124740/5,940 units = $21.00 costs— direct materials, direct labor, and both variable and fixed  $85050/5670 units= $15.00 manufacturing overhead — in unit product costs ­The Flow of Costs in a Job­Order Costing System and Processing Costing  = $36.00 System ­Cost Reconciliation report  Common Fixed Cost­ A fixed cost that supports more than one business  ­(PCS) DM, DL, MO ­> Processing Dept ­> FG ­> COGS segment, but is not traceable in while or in part to any one of the business  JOC­ DM, DL, MO ­> Jobs ­> FG ­> COGS Cost to be accounted for: segments Differences JO and PC: PC used when single product is produced on  ­Cost of beginning WIP Inventory (units, M, C)  Segment­ Any part or activity of an organization about which managers  900 units x .60= 540 M ; 900 units x .30 = 270 C continuing bases for long prd; JO is used w. many different jobs w.  seek cost, revenue, or profit data different production requirements each prd.  ­Cost added to production during the prd. (units) Segment Margin­ A segment’s contribution margin less its traceable fixed  ­Systems accum costs by dept; JOC accum cost indiv costs. It represents the margin available after a segment has covered all of  *Process costing used for products that are similar/produced continuously ­Total cost to be accounted for (units) its own traceable costs T­accounts and Journal Entries: ­Cost accounted for as follows: Cost of ending WIP Inventory Traceable Fixed Cost­ A fixed cost that is incurred because of the  Raw Materials____________ Cost of units transferred out existence of a particular business segment that would be eliminated if the  | Total cost accounted for segment were eliminated                     | direct materials  ( right side of T acct)  Variable Costing­ A costing method that includes only variable  Ch. 5 WIP Dept A     xx   (DM)    | Break­even point­ The level of sales at which profit is zero manufacturing costs— direct materials, direct labor, and variable  Contribution margin Ratio (CM Ratio)­ a ratio computed by dividing  manufacturing overhead— in unit product costs WIP Dept B    xx ( DM)      | contribution margin by dollar sales Questions concerning:  Raw Materials             | xx ­segmented income statement Cost­volume­profit (CVP) Graph­ A graphical representation of the  ­segment costing us $? yes/no Sal & Wage                 |xx  (DL) relationships between an organization’s revenues, costs, and profits on the  WIP Dept A              xx DL | one hand and its sales volume on the other hand ­variable vs. absorption costing Degree of Operating Leverage­ A measure, at a given level of sales, of  ­Problem 6­20, 21 WIP Dept B                xx DL| how a percentage change in sales will affect profits. The degree of  operating leverage is computed by dividing contribution margin by net 


Buy Material

Are you sure you want to buy this material for

0 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."

Amaris Trozzo George Washington University

"I made $350 in just two days after posting my first study guide."

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.