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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
Related Terms:Absorption costingA method of costing in which all fixed and variable production costs are charged to products or services using an allocation base. absorption costinga cost accumulation and reporting Absorption costingA methodology under which all manufacturing costs are assigned Activity-based costingA 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. activity based costing (ABC)A relatively new method advocated for the activity-based costing (ABC)a process using multiple cost drivers to predict and allocate costs to products and services; Activity-based costing (ABC)A cost allocation system that compiles costs and assigns algebraic methoda process of service department cost allocation Allowance methodA method of adjusting accounts receivable to the amount that is expected to be collected based on company experience. Arithmetic average (mean) rate of returnArithmetic mean return. attribute-based costing (ABC II)an extension of activitybased costing using cost-benefit analysis (based on increased customer utility) to choose the product attribute AverageAn arithmetic mean of selected stocks intended to represent the behavior of the market or some Average accounting returnThe average project earnings after taxes and depreciation divided by the average Average (across-day) measuresAn estimation of price that uses the average or representative price of a Average age of accounts receivableThe weighted-average age of all of the firm's outstanding invoices. Average Amortization PeriodThe average useful life of a company's collective amortizable asset base. Average Collection Periodaverage number of days necessary to receive cash for the sale of Average collection period, or days' receivablesThe ratio of accounts receivables to sales, or the total Average-Cost Inventory MethodThe inventory cost-flow assumption that assigns the average Average cost of capitalA firm's required payout to the bondholders and to the stockholders expressed as a Average inventoryThe beginning inventory for a period, plus the amount at the end of Average lifeAlso referred to as the weighted-average life (WAL). The average number of years that each Average maturityThe average time to maturity of securities held by a mutual fund. Changes in interest rates Average Propensity to ConsumeRatio of consumption to disposable income. See also marginal propensity to consume. Average Propensity to SaveRatio 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 rateTaxes as a fraction of income; total taxes divided by total taxable income. average tax rateTotal taxes owed divided by total income. backflush costinga streamlined cost accounting method that speeds up, simplifies, and reduces accounting effort in an environment that minimizes inventory balances, requires Benefit Ratio MethodThe proportion of unemployment benefits paid to a company’s Benefit Wage Ratio MethodThe proportion of total taxable wages for laid off Bootstrapping, bootstrap methodAn arithmetic method for backing an business process reengineering (BPR)the process of combining information technology to create new and more effective Capitalization methodA method of constructing a replicating portfolio in which the manager purchases a Completed-Contract MethodA contract accounting method that recognizes contract revenue Corporate processing floatThe time that elapses between receipt of payment from a customer and the cost-benefit analysis the analytical process of comparing therelative costs and benefits that result from a specific course Current rate methodUnder this currency translation method, all foreign currency balance-sheet and income Diffusion processA conception of the way a stock's price changes that assumes that the price takes on all direct costingsee variable costing Direct costingA costing methodology that only assigns direct labor and material costs Direct estimate methodA method of cash budgeting based on detailed estimates of cash receipts and cash Direct methodA method of preparing the operating section of the Statement of Cash Flows that uses the company’s actual cash inflows and cash outflows. direct methoda service department cost allocation approach Direct-Method FormatA format for the operating section of the cash-flow statement that reports actual cash receipts and cash disbursements from operating activities. Direct write-off methodA 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 methoda method of computing the cost Dollar-weighted rate of returnAlso called the internal rate of return, the interest rate that will make the Dow Jones industrial averageThis is the best known U.S.index of stocks. It contains 30 stocks that trade on Dow Jones Industrial AverageIndex of the investment performance of a portfolio of 30 “blue-chip” stocks. Equity MethodAccounting 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 MethodThe inventory cost-flow assumption that Flow-through methodThe practice of reporting to shareholders using straight-line depreciation and Full-Cost MethodA method of accounting for petroleum exploration and development expenditures full costingsee absorption costing high-low methoda technique used to determine the fixed hybrid costing systema costing system combining characteristics In-house processing floatRefers to the time it takes the receiver of a check to process the payment and Indirect methodA 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. Indirect-Method FormatA format for the operating section of the cash-flow statement that Ito processStatistical assumptions about the behavior of security prices. For Job costingA method of accounting that accumulates the costs of a product/service that is produced either job order costing systema system of product costing used joint processa manufacturing process that simultaneously judgmental method (of risk adjustment)an informal method of adjusting for risk that allows the decision maker Kaizen costingThe process of continual cost reduction that occurs after a product Last-In, First-Out (LIFO) Inventory MethodThe inventory cost-flow assumption that assigns the most recent inventory acquisition costs to cost of goods sold. The earliest inventory life cycle costingthe accumulation of costs for activities that Lifecycle costingAn approach to costing that estimates and accumulates the costs of a product/service over Log-linear least-squares methodA statistical technique for fitting a curve to a set of data points. One of the Market value-weighted indexAn index of a group of securities computed by calculating a weighted average method of least squaressee least squares regression analysis method of neglecta 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 methodUnder this translation method, monetary items (e.g. cash, accounts Moving averageUsed in charts and technical analysis, the average of security or commodity prices Moving averageA price average that is adjusted by adding other Moving average inventory methodAn inventory costing methodology that calls for the re-calculation of the average cost of all parts in stock after every purchase. Moving-averages chartA financial chart that plots leading and lagging multiprocess handlingthe ability of a worker to monitor net present value methoda process that uses the discounted Net Present Value (NPV) MethodA 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. Normalizing methodThe practice of making a charge in the income account equivalent to the tax savings Payback methodA capital budgeting analysis method that calculates the amount of Percentage-of-Completion MethodA contract accounting method that recognizes contract Price discovery processThe process of determining the prices of the assets in the marketplace through the ProcessA series of linked activities that result in a specific objective. For example, the process benchmarkingbenchmarking that focuses on practices and how the best-in-class companies achieved their results process complexityan assessment about the number of processes through which a product flows Process costingA 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. Process costingA costing methodology that arrives at an individual product cost through the calculation of average costs for large quantities of identical products. process costing systema method of accumulating and assigning costs to units of production in companies producing large quantities of homogeneous products; Process flow productionA production configuration in which products are continually process mapa flowchart or diagram indicating every step process productivitythe total units produced during a period process quality yieldthe proportion of good units that resulted from the activities expended processing timethe actual time consumed performing the
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