Flashcards
chapter 18 key terms
Cards in this deck (15)
- 1Average Inventorytotal of all inventories / number of times inventory taken
- 2Distribution of Overheadcompanies distribute overhead by floor space or sales volume
- 3First-In, First-Out (FIFO) Methodthis method assumes the first inventory brought into the store will be the first sold. ending inventory is made up of goods most recently purchased
- 4GAAPaccounting rules or standards 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 internationally to establish commonly accepted reporting of accounting information
- 7Inventory Turnoverratio that indicates how quickly inventory turns: cost of goods sold / average inventory at cost
- 8Just-In-Time (JIT) Inventory Systemsystem that eliminates inventories. suppliers provide materials daily as manufacturing company needs them
- 9Last-In, First-Out (LIFO) Methodthis method assumes the last inventory brought into the store will be the first sold. ending inventory is made up of the oldest goods purchased
- 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 updated; opposite of periodic inventory system
- 13Retail Methodmethod to estimate cost of ending inventory. the cost ratio x ending inventory at retail = the ending cost of inventory
- 14Specific Identification Methodthis method calculates 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 items remaining in inventory for that period of time
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- Flashcards on chapter 18 key terms, created by ALEIA CRANDALL on 29/09/2023.
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- ALEIA CRANDALL
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