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1-Cost Concepts

This document outlines key accounting concepts related to financial statements and cost accounting. It defines common financial statement terms like assets, liabilities, equity, income statement, and balance sheet. It also defines key cost accounting terms like cost of goods sold, manufacturing costs, direct materials, direct labor, factory overhead, and work-in-process. Costs are broken down for both merchandising and manufacturing companies. Key computations show costs as a percentage of sales.

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Dana Beatrice Roque
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37 views

1-Cost Concepts

This document outlines key accounting concepts related to financial statements and cost accounting. It defines common financial statement terms like assets, liabilities, equity, income statement, and balance sheet. It also defines key cost accounting terms like cost of goods sold, manufacturing costs, direct materials, direct labor, factory overhead, and work-in-process. Costs are broken down for both merchandising and manufacturing companies. Key computations show costs as a percentage of sales.

Uploaded by

Dana Beatrice Roque
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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COST CONCEPTS

FS - Financial Statement < Name of Company > < Name of Company >
heading Balance Sheet heading Income Statement
BS - Balance Sheet As of <date> For the period ending f <date> COGM
- Statement of Condition
Format: A L Format: Sales Format: WIP Invty, beg
IS - Income Statement Merchandising Less: COGS Manufacturing Add: TMC
- Profit & Loss Statement C & GP COGM WIP for the period
- Statement of Income & Expenses Manufacturing Less: Oprtng Exp Cost of Goods Less: WIP Invty, end
OR Less: ME Manufactured COGM
A - Assets Less: G&A
A
L - Liabilities EBIT/OI TMC TMC
C - Capital/ Owner's Equity/ Stockholder's Equity L Less: Interests Total Manufacturing DM
Less: Taxes Cost Add: DL
COGS - Cost of Goods Sold C NI Add: FOH
GP - Gross Profit TMC
OPERATING EXPENSES = SE + AE COGS
ME - Marketing Expenses RM used for production / DM
G&A - General & Administrative Expenses Merchandising Manufacturing Merchandising Manufacturing
EBIT - Earnings Before Interest & Taxes Invty, beg FG Invty, beg RM Invty, beg
OI - Operating Income Assets: Assets: Add: Pur Add: COGM Add: RM Pur
NI - Net Income Current Assets Current Assets AFS AFS Available for use in production
Cash Cash Less: Invty, end Less: FG Invty, end Less: RM Invty, end
beg - beginning Receivables Receivables COGS COGS RM used for production / DM
end - ending Inventory Inventory
Invty - Inventory Raw Materials
Pur - Purchases Work-in-Process PRODUCT COSTS = TMC
AFS - Available For Sale Finished Goods PRIME COSTS DM
CONVERSION COSTS Add: DL
FG - Finished Goods Computations as a percentage of Sales: example Add: FOH = Indirect Costs
WIP - Work-In-Process 100% Sales 100% TMC
RM - Raw Materials ( % of Sales) Less: COGS 070%
GP 030% PRODUCT COSTS = TMC = DM + DL + MOH
DM - Direct Materials DIRECT or PRIME COSTS = DM + DL
DL - Direct Labor CONVERSION COSTS = DL + FOH
FOH - Factory Overhead

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