ACC 222 Exam 1 Formulas

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Period Costs

All costs that are not product costs (All selling & administrative costs)

Total Direct Labor Hours

Direct Labor Cost ------------------------------ Direct labor wage rate/hr

Conversion Cost

Direct Labor Cost + Manufacturing Overhead Cost

Prime Cost

Direct Materials Cost + Direct Labor Cost

Total Incremental Cost

Direct materials per unit + Direct labor per unit+ Variable MO per unit

Total Fixed Manufacturing Cost

Fixed MO per unit X # of units budgeted

Fixed cost

Fixed cost per unit decreases as volume increases & Total fixed cost remains the same at all volume levels

Total Period Cost

Fixed selling expense + Fixed admin expense + Sales commissions + Variable admin expense (multiply total by # of units sold)

Manufacturing Overhead

Indirect materials, indirect labor, factory utilities, depreciation of factory buildings and equipment

Under/Overapplied overhead

Manufacturing Overhead Cost incurred - Manufacturing Overhead Cost applied* *Actual DLH X POR

Manufacturing Overhead Applied

Predetermined overhead rate X Amt. of actual allocation base incurred by the job

Contribution Margin

Selling price - Variable cost

Adjusted Cost of Goods Sold

Unadjusted Cost of Goods Sold + Underapplied/Overapplied overhead

Amount of M.O.H applied to Work in Process in the Cost of Goods Manufactured Schedule

predetermined overhead rate X actual amount of allocation base incurred in all jobs

Cost of Goods Available for Sale

Beginning Finished Goods Inventory + Cost of Goods Manufactured

Unadjusted Cost of Goods Sold

Beginning Finished Goods Inventory + Cost of Goods Manufactured - Ending Finished Goods Inventory

Overhead cost at year end (w/ two jobs)

Direct labor X POR(other job's rate)* *Have to find rate! --> Direct labor/Overhead cost

Total Direct Manufacturing Cost

Direct manufacturing cost X # of units DMC (Direct materials per unit + Direct labor per unit

Product Costs

Direct materials + Direct labor + Manufacturing overhead

Total Product/Manufacturing Cost

Direct materials + Direct labor + Manufacturing overhead

Variable Cost

Direct materials + direct labor + MO (variable) + sales commissions + variable admin expense (Variable cost doesn't change w/ amt. of units sold! & Total variable cost increases as volume increases)

Estimated Total Manufacturing Overhead Cost

Est. total fixed MO cost + (Est. variable manufacturing overhead cost per unit of the allocation base X est. total amount of the allocation base)

Predetermined Overhead Rate

Estimated Manufacturing Overhead Cost* ----------------------------------- Estimated Amount of the Allocation Base *Est. total fixed MO+(Variable MO per hr X Est. total hrs)

Cost of Goods Manufactured

Total manufacturing costs + beginning Work in Process inventory - ending Work in Process inventory

Unit Product Cost

Total product cost / # of units

Total Indirect Manufacturing Cost

Total variable overhead cost + Total fixed overhead

Total MO Cost Incurred

Total variable overhead cost + Total fixed overhead TVOC is (variable overhead per unit X # units produced)


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