|weighted average method (of process costing)|
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Definition of weighted average method (of process costing)
weighted average method (of process costing)
the method of cost assignment that computes an average cost per
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
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 process of service department cost allocation
A method of adjusting accounts receivable to the amount that is expected to be collected based on company experience.
Arithmetic mean return.
an extension of activitybased costing using cost-benefit analysis (based on increased customer utility) to choose the product attribute
An arithmetic mean of selected stocks intended to represent the behavior of the market or some
The average project earnings after taxes and depreciation divided by the average
An estimation of price that uses the average or representative price of a
The weighted-average age of all of the firm's outstanding invoices.
Average Amortization Period
The average useful life of a company's collective amortizable asset base.
Average Collection Period
average number of days necessary to receive cash for the sale of
Average collection period, or days' receivables
The ratio of accounts receivables to sales, or the total
Average-Cost Inventory Method
The inventory cost-flow assumption that assigns the average
Average cost of capital
A firm's required payout to the bondholders and to the stockholders expressed as a
The beginning inventory for a period, plus the amount at the end of
Also referred to as the weighted-average life (WAL). The average number of years that each
The average time to maturity of securities held by a mutual fund. Changes in interest rates
Average Propensity to Consume
Ratio of consumption to disposable income. See also marginal propensity to consume.
Average Propensity to Save
Ratio of saving to disposable income. See also marginal propensity to save.
Average rate of return (ARR)
The ratio of the average cash inflow to the amount invested.
Average tax rate
Taxes as a fraction of income; total taxes divided by total taxable income.
average tax rate
Total taxes owed divided by total income.
a streamlined cost accounting method that speeds up, simplifies, and reduces accounting effort in an environment that minimizes inventory balances, requires
Benefit Ratio Method
The proportion of unemployment benefits paid to a company’s
Benefit Wage Ratio Method
The proportion of total taxable wages for laid off
Bootstrapping, bootstrap method
An arithmetic method for backing an
business process reengineering (BPR)
the process of combining information technology to create new and more effective
A method of constructing a replicating portfolio in which the manager purchases a
A contract accounting method that recognizes contract revenue
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
Current rate method
Under this currency translation method, all foreign currency balance-sheet and income
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
Direct estimate method
A method of cash budgeting based on detailed estimates of cash receipts and cash
A method of preparing the operating section of the Statement of Cash Flows that uses the company’s actual cash inflows and cash outflows.
a service department cost allocation approach
A format for the operating section of the cash-flow statement that reports actual cash receipts and cash disbursements from operating activities.
Direct write-off method
A method of adjusting accounts receivable to the amount that is expected to be collected by eliminating the account balances of specific nonpaying customers.
dividend growth method
a method of computing the cost
Dollar-weighted rate of return
Also called the internal rate of return, the interest rate that will make the
Dow Jones industrial average
This is the best known U.S.index of stocks. It contains 30 stocks that trade on
Dow Jones Industrial Average
Index of the investment performance of a portfolio of 30 “blue-chip” stocks.
Accounting method for an equity security in cases where the investor has sufficient
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
First-In, First-Out (FIFO) Inventory Method
The inventory cost-flow assumption that
The practice of reporting to shareholders using straight-line depreciation and
A method of accounting for petroleum exploration and development expenditures
see absorption costing
a technique used to determine the fixed
hybrid costing system
a costing system combining characteristics
In-house processing float
Refers to the time it takes the receiver of a check to process the payment and
A method of preparing the operating section of the Statement of Cash Flows that does not use the company’s actual cash inflows and cash outflows, but instead arrives at the net cash flow by taking net income and adjusting it for noncash expenses and the changes from last year in the current assets and current liabilities.
A format for the operating section of the cash-flow statement that
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
judgmental method (of risk adjustment)
an informal method of adjusting for risk that allows the decision maker
The process of continual cost reduction that occurs after a product
Last-In, First-Out (LIFO) Inventory Method
The inventory cost-flow assumption that assigns the most recent inventory acquisition costs to cost of goods sold. The earliest inventory
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
Log-linear least-squares method
A statistical technique for fitting a curve to a set of data points. One of the
Market value-weighted index
An index of a group of securities computed by calculating a weighted average
method of least squares
see least squares regression analysis
method of neglect
a method of treating spoiled units in the
modified FIFO method (of process costing)
the method of cost assignment that uses FIFO to compute a cost per
Monetary / non-monetary method
Under this translation method, monetary items (e.g. cash, accounts
Used in charts and technical analysis, the average of security or commodity prices
A price average that is adjusted by adding other
Moving average inventory method
An inventory costing methodology that calls for the re-calculation of the average cost of all parts in stock after every purchase.
A financial chart that plots leading and lagging
the ability of a worker to monitor
net present value method
a process that uses the discounted
Net Present Value (NPV) Method
A method of ranking investment proposals. NPV is equal to the present value of the future returns, discounted at the marginal cost of capital, minus the present value of the cost of the investment.
The practice of making a charge in the income account equivalent to the tax savings
A capital budgeting analysis method that calculates the amount of
A contract accounting method that recognizes contract
Price discovery process
The process of determining the prices of the assets in the marketplace through the
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 costing system
a method of accumulating and assigning costs to units of production in companies producing large quantities of homogeneous 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
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