Flashcards
Ch 18 key terms
Cards in this deck (15)
- 1Average InventoryTotal of all inventories divided by number of times inventory taken
- 2Distribution of overheadCompanies distribute overhead by floor space or sales volume
- 3First in first out methodfirst inventory brought in will be the first sold leaving inventory with recently purchased inventory
- 4GAAPstandards set by a policy board to establish commonly accepted reporting of accounting information
- 5Gross Profit MethodUsed to estimate value of inventory
- 6IFRSAccounting rules or standards used to internationally establish commonly accepted reporting of accounting information
- 7Inventory TurnoverRatio that indicates how quickly inventory turn: Cost of goods sold/ Average inventory at cost
- 8Just in time inventory sysyemSystem that eliminates inventories. Suppliers provide materials daily as manufacturing company needs them
- 9Last in first out methodThis method assumes the last inventory brought into the store will be the first sold. Ending inventory is made up of the oldest goods purchase
- 10Overhead expensesoperating expenses not directly associated with a specific department or product
- 11Periodic inventory systemPhysical count of inventory taken at end of a time period. inventory records are not continually updated.
- 12Perpetual inventory systeminventory records are continually updatedd opposite of periodic inventory system
- 13Retail MethodMethod to estimate cost of ending inventory. The cost ratio times ending inventory at retail equals the ending cost of inventory
- 14Specific identification methodThis method calculated the cost of ending inventory by identifying each item remaining to invoice price
- 15weighted average methodCalculates the cost of ending inventory by applying an average unit cost to item remaining in inventory for that time
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- Flashcards on Ch 18 key terms, created by Mlisa Hartzell on 28/09/2024.
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- Mlisa Hartzell
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