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Questions and Answers
What is Direct Materials Used calculated from?
What is Direct Materials Used calculated from?
What does Cost of Goods Manufactured equal?
What does Cost of Goods Manufactured equal?
Beginning work in process inventory + Total manufacturing costs incurred - Ending work in process inventory
How do you calculate Costs of Goods Purchased?
How do you calculate Costs of Goods Purchased?
Purchase + Freight-in - Purchase discounts - Purchase returns and allowance
What is Total Overhead?
What is Total Overhead?
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Cost of Direct Materials Used is calculated using which formula?
Cost of Direct Materials Used is calculated using which formula?
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How do you find Unit Costs?
How do you find Unit Costs?
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What are Direct Manufacturing Labor Costs calculated from?
What are Direct Manufacturing Labor Costs calculated from?
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Manufacturing overhead costs incurred equals what?
Manufacturing overhead costs incurred equals what?
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What formula describes Cost of Goods Sold?
What formula describes Cost of Goods Sold?
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How is Direct Materials Inventory determined?
How is Direct Materials Inventory determined?
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What does Work in Process Inventory equal?
What does Work in Process Inventory equal?
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How is Finished Goods Available for Sale calculated?
How is Finished Goods Available for Sale calculated?
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How do you find Finished Goods Inventory?
How do you find Finished Goods Inventory?
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Study Notes
Key Managerial Accounting Formulas
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Direct Materials Used: Calculates materials consumed in production by adding beginning materials, purchases, and subtracting materials available for production.
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Cost of Goods Manufactured (COGM): Reflects total production costs incurred minus the ending work in process inventory, indicating completed goods ready for sale.
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Costs of Goods Purchased: Determines purchase costs by calculating purchases, adding freight-in, and subtracting discounts and returns.
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Total Overhead: Sum of fixed and variable overhead costs, essential for determining total manufacturing costs.
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Cost of Direct Materials Used: Derived from beginning inventory, purchases, and subtracting ending inventory to find the actual materials used in production.
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Unit Costs: Represents the manufacturing costs allocated per unit produced, calculated by dividing total manufacturing costs by the output amount.
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Direct Manufacturing Labor Costs: Indicates labor costs incurred by subtracting direct materials and overhead from total manufacturing costs.
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Manufacturing Overhead Costs Incurred: Total manufacturing costs minus both direct materials and direct labor, reflecting overhead expenses.
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Cost of Goods Sold (COGS): Calculates the cost of goods sold by adding beginning finished goods inventory with COGM and subtracting the ending finished goods inventory.
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Direct Materials Inventory: Measures the materials available by starting with beginning inventory, adding purchases, and subtracting used materials.
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Work in Process (WIP) Inventory: Represents goods in production by summing beginning WIP inventory with manufacturing costs incurred and subtracting COGM.
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Finished Goods Available for Sale: Indicates the remaining finished goods after accounting for COGM.
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Finished Goods Inventory: Reveals the inventory left by deducting COGS from finished goods available for sale.
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Enhance your understanding of key managerial accounting formulas with these flashcards. Each card provides essential definitions and calculations for concepts like Direct Materials Used and Cost of Goods Manufactured, helping you master the subject.
