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Accounting Chapters 18-20
Devaney's accounting 2
22
Accounting
Undergraduate 1
01/22/2009

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Term
indirect labor
Definition
efforts of production employees who do not work specifically on converting direct materials into finished products and who are not cleraly identified with specific units or batches of product.
Term
indirect labor costs
Definition
labor costs that cannot be physically traced to production of a product or service; included as part of overhead.
Term
indirect material
Definition
material used to support the production process but not clearly identified with products or batches of product
Term
just-in-time manufacturing
Definition
proce.ss of recording transactions in a journal
Term
lean business model
Definition
practice of eliminating waste while meeting customer needs and yielding positive company returns.
Term
managerial accounting
Definition
area of accounting mainly aimed at serving the decision-making needs of internal users; also called management accounting
Term
manufacturing statement
Definition
report that summarizes the types and amounts of costs incurred in a company's production process for a period; also called cost of goods manufacturing statement.
Term
non-value-added time
Definition

the portion of cycle time that is not directed at producing a product or service; equals the sum of inspection time, move time, and wait time.

Term
opportunity cost
Definition
potential benefit lost by choosing a specific action from two or more alternatives.
Term
out-of-pocket cost
Definition
cost incurred or avoided as a result of management's decisions.
Term
period costs
Definition
expenditures identified more with a time period than with finished products costs; includes selling and general administrative expenses.
Term
planning
Definition
process of setting goals and preparing to achieve them.
Term

prime costs

Definition
expenditures directly identified with the production of finished goods; include direct materials costs and direct labor costs.
Term
product costs
Definition

costs that are capitalized as inventory because they produce benefits expected to have future value; include direct materials, direct labor, and overhead.

Term
raw materials inventory
Definition
goods a company acquires to use in making products.
Term
sunk cost
Definition
cost already incurred and cannot be avoided or changed
Term
total quality management
Definition
concept calling for all managers and employees at all stages of operations to strive toward higher standards and reduce number of defects.
Term
value-added time
Definition
the portion of cycle time that is directed at producing a product or service; equals process time.
Term
value chain
Definition
sequential activities that add value to an entity's procuts or services; includes design, production, marketing, distribution, and service.
Term
variable cost
Definition
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