|process costing system|
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Definition of process costing system
process costing system
a method of accumulating and assigning costs to units of production in companies producing large quantities of homogeneous products;
an approximation of the number of whole units of output that could have been
a costing system combining characteristics
A method of costing in which all fixed and variable production costs are charged to products or services using an allocation base.
a cost accumulation and reporting
A methodology under which all manufacturing costs are assigned
Schedule of depreciation rates allowed for tax purposes.
A set of accounts that summarize the transactions of a business that have been recorded on source documents.
A method of costing that uses cost pools to accumulate the cost of significant business activities and then assigns the costs from the cost pools to products or services based on cost drivers.
A relatively new method advocated for the
a process using multiple cost drivers to predict and allocate costs to products and services;
A cost allocation system that compiles costs and assigns
a valuation method that uses actual direct
an extension of activitybased costing using cost-benefit analysis (based on increased customer utility) to choose the product attribute
A racking system using automated systems
a streamlined cost accounting method that speeds up, simplifies, and reduces accounting effort in an environment that minimizes inventory balances, requires
business intelligence (BI) system
a formal process for gathering and analyzing information and producing intelligence to meet decision making needs; requires information about
business process reengineering (BPR)
the process of combining information technology to create new and more effective
a system using transfer prices; see transfer
Clearing House Automated Payments System (CHAPS)
A computerized clearing system for sterling funds
Clearing House Interbank Payments System (CHIPS)
An international wire transfer system for high-value
Corporate processing float
The time that elapses between receipt of payment from a customer and the
cost-benefit analysis the analytical process of comparing the
relative costs and benefits that result from a specific course
cost control system
a logical structure of formal and/or informal
cost management system (CMS)
a set of formal methods
A conception of the way a stock's price changes that assumes that the price takes on all
see variable costing
A costing methodology that only assigns direct labor and material costs
Du Pont system
A breakdown of ROE and ROA into component ratios.
Dupont system of financial control
Highlights the fact that return on assets (ROA) can be expressed in terms
Electronic Federal Tax Payment Systems (EFTPS)
An electronic funds transfer system used by businesses to remit taxes to the government.
enterprise resource planning (ERP) system
a packaged software program that allows a company to
Enterprise resource planning system
A computer system used to manage all company
European Monetary System (EMS)
An exchange arrangement formed in 1979 that involves the currencies
Federal Reserve System
The central bank of the U.S., established in 1913, and governed by the Federal
Federal Reserve System
The central banking authority responsible for monetary policy in the United States.
FIFO method (of process costing)
the method of cost assignment that computes an average cost per equivalent
First in, first-out costing method (FIFO)
A process costing methodology that assigns the earliest
flexible manufacturing system (FMS)
a production system in which a single factory manufactures numerous variations
see absorption costing
Imputation tax system
Arrangement by which investors who receive a dividend also receive a tax credit for
In-house processing float
Refers to the time it takes the receiver of a check to process the payment and
Canada's bank machine and electronic debit system. If you use your bank card at a bank machine which displays the Interac symbol (and that bank machine is not your bank's machine), you will be charged a fee.
Statistical assumptions about the behavior of security prices. For
A method of accounting that accumulates the costs of a product/service that is produced either
job order costing system
a system of product costing used
a manufacturing process that simultaneously
Just-in-time inventory systems
systems that schedule materials/inventory to arrive exactly as they are
just-in-time manufacturing system
a production system that attempts to acquire components and produce inventory only as needed, to minimize product defects, and to
The process of continual cost reduction that occurs after a product
life cycle costing
the accumulation of costs for activities that
An approach to costing that estimates and accumulates the costs of a product/service over
system whereby customers send payments to a post office box and a local bank collects and processes checks.
MACRS (Modified Accelerated Cost Recovery System)
A depreciation method created by the IRS under the Tax Reform Act of 1986. Companies must use it to depreciate all plant and equipment assets installed after December 31, 1986 (for tax purposes).
management control system (MCS)
an information system that helps managers gather information about actual organizational occurrences, make comparisons against plans,
management information system (MIS)
a structure of interrelated elements that collects, organizes, and communicates
Modified Accelerated Cost Recovery System (MACRS)
Depreciation method that allows higher tax deductions in early years and lower deductions later.
modified FIFO method (of process costing)
the method of cost assignment that uses FIFO to compute a cost per
the ability of a worker to monitor
A technical trading strategy that combines mechanical rules, such as the CRISMA
Nonmarket or firm-specific risk factors that can be eliminated by diversification. Also
normal cost system
a valuation method that uses actual
system whereby a depositor may write cheques in excess of the balance, with the bank automatically extending a loan to cover the shortage.
performance management system
a system reflecting the entire package of decisions regarding performance measurement and evaluation
Periodic inventory system
An inventory system in which the balance in the Inventory account is adjusted for the units sold only at the end of the period.
Perpetual inventory system
An inventory system in which the balance in the Inventory account is adjusted for the units sold each time a sale is made.
Planning, programming and budgeting system (PPBS)
A method of budgeting in which budgets are allocated to projects or programmes rather than to responsibility centres.
A bank machine network outside Canada, across the U.S. and internationally. Customers who use a bank machine with a 'PLUS' symbol may be charged a fee.
Price discovery process
The process of determining the prices of the assets in the marketplace through the
See market mechanism.
A series of linked activities that result in a specific objective. For example, the
benchmarking that focuses on practices and how the best-in-class companies achieved their results
an assessment about the number of processes through which a product flows
A method of costing for continuous manufacture in which costs for an accounting compared are compared with production for the same period to determine a cost per unit produced.
A costing methodology that arrives at an individual product cost through the calculation of average costs for large quantities of identical products.
Process flow production
A production configuration in which products are continually
a flowchart or diagram indicating every step
the total units produced during a period
process quality yield
the proportion of good units that resulted from the activities expended
the actual time consumed performing the
product- (or process-) level cost
a cost that is caused by the development, production, or acquisition of specific products or services
Progressive tax system
A tax system wherein the average tax rate increases for some increases in income but
a production system dictated by product sales
A materials flow concept in which parts are only withdrawn after a
Purchased In-Process Research and Development
Unfinished research and development that is acquired from another firm.
the traditional production system in which
A materials flow concept in which parts are issued based on planned
an inventory ordering system in which a red
a process that compares, to the extent possible
Material that has been reworked and returned to stock.
responsibility accounting system
an accounting information system for successively higher-level managers about the performance of segments or subunits under the control
Split-rate tax system
A tax system that taxes retained earnings at a higher rate than earnings that are
standard cost system
a valuation method that uses predetermined
statistical process control (SPC)
the use of control techniques that are based on the theory that a process has natural variations in it over time, but uncommon variations
strict FIFO method (of process costing)
the method of cost assignment that uses FIFO to compute a cost per equivalent unit and, in transferring units from a department, keeps the
Common to all businesses.
Also called undiversifiable risk or market risk, the minimum level of risk that can be
The amount of total risk that cannot be eliminated by portfolio
Systematic risk principle
Only the systematic portion of risk matters in large, well-diversified portfolios.
systematic withdrawal plan
Plans offered by mutual fund companies that allow unitholders to receive payment from their investment at regular intervals.
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