Accounting Tools

NOVEMBER 3, 2023

A step cost is a cost that does not change steadily with changes in activity volume, but rather at discrete points. The same pattern applies in reverse when the volume of activity declines. Thus, the cost of the shift supervisor is a step cost that occurs when the company reaches a production requirement of 10,001 widgets.

Cost Accounting 76

Cost Accounting Budgeting Accounting Accounting 76

Intuit

MAY 18, 2023

This mission goes beyond just creating great products that work for most people. Intuit strives for the best in website accessibility to ensure our products and experiences are open to everyone—regardless of physical, sensory or cognitive ability, or other attributes. Intuit’s mission is to power prosperity around the world.

QuickBooks 201

QuickBooks Tax Accounting Accounting 201

Accounting Tools

FEBRUARY 13, 2024

Taking inventory can require that a company cease its normal warehousing and production activities in order to ensure an accurate count, so the count is commonly conducted after hours or on a weekend.

Accounting 75

Accounting Accounting 75

Accounting Tools

SEPTEMBER 25, 2023

Related Courses Activity-Based Costing Activity-Based Management Cost Accounting Fundamentals What is the Cost Hierarchy? The cost hierarchy is a classification system used in activity-based costing that designates activities based on how easily they can be traced to a product. Activities at the batch level.

Cost Accounting 40

Cost Accounting Accounting Accounting 40

Accounting Tools

MARCH 5, 2024

Fixed charges are overhead costs that are not closely associated with activity levels. Fixed charges can represent the majority of all expenditures incurred by a business, especially if the organization has a large fixed asset base that it must maintain, irrespective of the actual level of sales.

Cost Accounting 40

Cost Accounting Budgeting Accounting Accounting 40

Accounting Tools

NOVEMBER 1, 2023

Related Courses Activity-Based Costing Cost Accounting Fundamental What is an Expense Allocation? Examples of cost objects are products, product lines , customers , sales regions, and subsidiaries. An indirect cost is a cost that is not associated with a single activity.

Financial Statements 75

Financial Statements Cost Accounting Financial Reporting Accounting 75

Accounting Tools

MAY 6, 2024

ABC analysis is used to categorize items into three classifications, based on activity levels. This breakdown can then be used to exercise high levels of monitoring over "A" classification inventory, and the least monitoring over "C" classification inventory.

Customer Service 40

Customer Service Accounting Accounting 40

Accounting Tools

DECEMBER 22, 2023

What is Normal Activity? Normal activity is the average level of production volume for an extended period of time that incorporates short-term fluctuations. This activity level is used as the basis for a calculation of the standard factory overhead rate, which is then applied to units produced.

Cost Accounting 40

Cost Accounting Accounting Accounting 40

Accounting Tools

SEPTEMBER 11, 2023

Related Courses Cost Accounting Fundamentals What are Facility-Level Activities? Facility-level activities are those actions taken to maintain the general operations of a business. These actions cannot be traced to individual products, production cells, or product lines.

Cost Accounting 40

Cost Accounting Accounting Accounting 40

Accounting Tools

JULY 27, 2023

Related Courses Activity-Based Costing Activity-Based Management Cost Accounting Fundamentals What is Costing? Costing is typically used to develop costs for customers, distribution channels , employees, geographic regions, products, product lines , processes, subsidiaries , and entire companies.

Cost Accounting 75

Cost Accounting Tax Accounting Accounting 75

Accounting Tools

MAY 18, 2024

For example, if you are reviewing the direct cost of a single product, the only direct cost may be the materials used in its construction. For example, if you are reviewing the direct cost of a single product, the only direct cost may be the materials used in its construction. Automation investments. Outsourcing.

Financial Statements 52

Financial Statements Financial Reporting Financial Analysis Cost Accounting 52

Accounting Tools

FEBRUARY 10, 2024

Batch cost is the cluster of costs incurred when a group of products or services are produced, and which cannot be more specifically linked to individual products or services within the group. Another batch cost is machine setup costs, which include the cost of running samples through equipment prior to initiating actual production.

Cost Accounting 40

Cost Accounting Accounting Accounting 40

Accounting Tools

OCTOBER 9, 2023

Related Courses Activity-Based Costing Constraint Management Cost Accounting Fundamentals What is Manufacturing Cost Accounting? Manufacturing cost accounting encompasses areas that impact production operations and the valuation of inventory. The cost accountant is primarily responsible for manufacturing accounting activities.

Cost Accounting 75

Cost Accounting Accounting Accounting Budgeting 75

Accounting Tools

JUNE 7, 2023

Related Courses Activity-Based Costing Cost Accounting Fundamentals What are Fixed Costs? A fixed cost is a cost that does not increase or decrease in conjunction with any activities. Thus, a business will incur fixed costs even when there is no business activity. What are Variable Costs? What are Variable Costs?

Cost Accounting 75

Cost Accounting Accounting Accounting 75

Accounting Tools

NOVEMBER 20, 2023

Variance analysis is especially effective when you review the amount of a variance on a trend line , so that sudden changes in the variance level from month to month are more readily apparent. The actual price paid for materials used in the production process, minus the standard cost, multiplied by the number of units used.

Budgeting 75

Budgeting Financial Analysis Billing Cost Accounting 75

Accounting Tools

JULY 21, 2023

Related Courses Activity-Based Management Constraint Management Lean Accounting Guidebook What is Value Analysis? Value analysis is a systematic review of the production, purchasing and product design processes to reduce overall product costs.

Accounting 40

Accounting Accounting 40

Accounting Tools

NOVEMBER 6, 2023

Related Courses Activity-Based Management New Manager Guidebook What is Time-Based Management? The concept is most commonly employed in the production area, where time reduction eliminates labor and inventory holding costs, thereby making a company's products more cost -competitive.

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40

Accounting Tools

MARCH 11, 2024

An allocation rate is the standard amount of overhead applied to a unit of production or other measure of activity. The resulting allocation rate would only be applied to the units produced by the purple widget production line. Given these activity levels, the allocation rate should be $.01

Cost Accounting 40

Cost Accounting Accounting Accounting 40

Accounting Tools

OCTOBER 24, 2023

A high turnover rate can be achieved by being selective about only dealing with high-grade customers, as well as by limiting the amount of credit granted and engaging in aggressive collection activities. However, it is possible to shrink inventory levels too much, if doing so results in longer delivery times to customers.

Accounts Payable 75

Accounts Payable Accounts Payable Accounts Receivable Accounts Receivable 75

Accounting Tools

NOVEMBER 6, 2023

Related Courses Budgeting Capital Budgeting What is Activity-Based Budgeting? Activity-based budgeting is a planning system under which costs are associated with activities , and expenditures are then budgeted based on the expected activity level.

Budgeting 40

Budgeting 40

Accounting Tools

SEPTEMBER 24, 2023

A cost function is a formula used to predict the cost that will be experienced at a certain activity level. This formula tends to be effective only within a range of activity levels, beyond which it no longer yields accurate results.

Budgeting 40

Budgeting Cost Accounting Accounting Accounting 40

Accounting Tools

OCTOBER 24, 2023

The fixed element of the cost will be incurred repeatedly over time, while the variable element will only be incurred as a function of activity volume. Thus, a base-level cost will be always be incurred, irrespective of volume, as well as an additional cost that is based only on volume.

Financial Analysis 40

Financial Analysis Financial Statements Cost Accounting Budgeting 40

Accounting Tools

OCTOBER 7, 2023

The service marketing mix is comprised of seven activities that are used to optimize the marketing for a service. All seven activities are needed to achieve the optimum level of service delivery. The activities are noted below. Product This is a service product, and so is not tangible.

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40

Accounting Tools

FEBRUARY 15, 2024

What is Activity-Based Management? Activity-based management (ABM) is used to determine the profitability of every aspect of a business, so that those areas can be upgraded or eliminated. The intent is to achieve a more fine-tuned organization with a higher level of profitability.

Customer Service 40

Customer Service Budgeting Collections Cost Accounting 40

Accounting Tools

APRIL 28, 2024

The standard cost to operate a machine is based on expected capacity levels, utility costs, and scheduled maintenance charges. Or, an engineering team assumes too high a production volume when calculating direct labor costs , so that the actual labor cost is much higher than the standard cost. Variable overhead spending variance.

Budgeting 40

Budgeting Cost Accounting Accounting Accounting 40

Accounting Tools

JULY 30, 2023

Fixed overhead is a set of costs that do not vary as a result of changes in activity. Examples of fixed overhead costs that are specific to a production area (and which are usually allocated to manufactured goods) are factory rent, utilities, production supervisory salaries, and normal scrap.

Cost Accounting 75

Cost Accounting Budgeting Accounting Accounting 75

Accounting Tools

JUNE 7, 2023

Related Courses Activity-Based Costing Cost Accounting Fundamentals What is a Cost Allocation? A cost object is any activity or item for which you want to separately measure costs. Examples of cost objects are a product, a research project, a customer, a sales region, and a department.

Cost Accounting 75

Cost Accounting Financial Reporting Tax Accounting 75

Accounting Tools

MARCH 25, 2024

Limit pricing is the practice of setting a product or service price at a level just low enough to deter potential market entrants from competing in a market. Also, if the company does not keep its products and services at a sufficiently high level, someone could sidestep the limit price with a unique product or service offering.

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Accounting Tools

MAY 16, 2023

Normal capacity is the amount of production volume that can be reasonably expected over the long term. Normal capacity takes into account the downtime associated with periodic maintenance activities, crewing problems, and so forth.

Budgeting 40

Budgeting Accounting Accounting 40

Accounting Tools

MAY 7, 2024

These measurements can be used to examine the performance of all aspects of a business, including the accounting, engineering, finance, marketing, materials management, production, research, and sales departments. Related Articles Accounting Ratios Activity Ratios Efficiency Ratios Operating Performance Ratios

Financial Statements 40

Financial Statements Collections Accounts Receivable Accounts Receivable 40

Accounting Tools

OCTOBER 6, 2023

This is a more important issue when a business is constantly changing its products and acquiring other businesses, since these activities imply the existence of significant changes to the underlying processes, which introduce new risks. The amount of information communicated should be appropriate to the needs of the recipient.

Financial Statements 75

Financial Statements Auditing Accounting Accounting 75

Accounting Tools

JUNE 21, 2023

Conversion costs are those production costs required to convert raw materials into completed products. It can also be used to determine the incremental cost of creating a product, which could be useful for price setting purposes. Related Courses Accounting for Inventory Cost Accounting Fundamentals What are Conversion Costs?

Cost Accounting 75

Cost Accounting Payroll Tax Accounting 75

Accounting Tools

SEPTEMBER 9, 2023

Related Courses Cost Accounting Fundamentals A fixed cost is a cost that does not change over the short-term, even if a business experiences changes in its sales volume or other activity levels. This is the gradual charging to expense of the cost of a tangible asset (such as production equipment) over the useful life of the asset.

Cost Accounting 75

Cost Accounting Tax Accounting Accounting 75

Accounting Tools

AUGUST 1, 2023

Related Courses Activity-Based Costing Cost Accounting Fundamentals Financial Analysis What is Cost Behavior? Cost behavior is the manner in which expenses are impacted by changes in business activity. First is variable costs , which vary directly with changes in business activity.

Financial Analysis 40

Financial Analysis Cost Accounting Budgeting Accounting 40

Accounting Tools

AUGUST 29, 2023

The idle capacity variance is the amount by which actual production usage declines below the normal or expected production level, multiplied by the overhead application rate. For example, a machine has a normal, long-term usage level of 400 hours per month (essentially two shifts of work per business day).

Cost Accounting 40

Cost Accounting Accounting Accounting 40

Accounting Tools

JUNE 19, 2023

Sales mix is the proportion of different products and services that comprise the total sales of a company. Thus, if a company introduces a new product that has a low profit, and which it sells aggressively, it is quite possible that profits will decline even as total sales increase. Do the same for each of the products sold.

Budgeting 75

Budgeting Financial Statements Cost Accounting Accounting 75

Accounting Tools

MAY 18, 2024

Conversely, organic growth tends to be less expensive, depending on how prudently management invests in marketing, distribution channels, and new product development. Increase the number of units sold of existing products. Sell entirely new products. Selling new products will require an investment in research and development.

Financial Statements 40

Financial Statements Financial Analysis 40