Factory Over Head Cost:

Managerial Accountant uses the Factory Over Head Cost to complete their productions and improves their product quality and efficiency. The FOH actually means the costs which are not directly related to the production or manufacturing activity but that cost we need to complete the product and make it more efficient or effective in quality to use. There are three different portions of the Factory Overhead Costs. These portions are Material Overhead, Labor Overhead, and Utility Overheads. These Material and Labor overhead costs are indirect and not directly involved in the production. The material that indirectly supports the production is known as material overhead, the labor supports which indirectly support the complete activity to improve the time efficiency is known as labor overhead and the utilities like insurance, rent, depreciations and many more expenses like it are known as factory overhead costs.

The Formula normally used for Factory Overhead Cost is as follows:

Comments

Joint Cost allocation methods:

Joint cost allocation means to allocate the cost for those products which require the same kind of raw material and part of a same manufacturing process. But at the end of the result two or more than two final products we have form this manufacturing activity. Each product require the almost same material but the cost allocations to them is different during the manufacturing activities. There are many different methods the product based organizations using in their manufacturing processes. The mostly known are Physical unit method in which each portion allocates the costs as per the activity weight. Sales- Value at Split-Off method in which the cost allocations to the activities over the sales of the products. The other two methods are estimated net realizable value method, and...

Financial Measures:

Financial Measures: Financial Measures means the measurement of the financial performance of the business and its projects. Performance measures can be defined, to check and measure the efficiency of a business investment which is invested or capitalized in a business project and through this investment they want to measure the business financial performances . There are many financial performance measurement tools or ratios which helps the business to check and measure the business performance and its financial growth. We have many examples to check out the financial performance and investment outcomes, like ROI –Return on Investment which helps us to measure the total return over investment. The formula which is used for ROI is Net Income of that period divided by the Average total ...

ACCOUNTING CYCLE

Accounting Cycle: Accounting is the field of study which tells us about how to collect the economic figures, evaluate and analyze them and record them in a very respectable and professional way to present to the business stakeholders and helps them to collect the required information from the pool of business transactions. That is an art and we also knows it with the name of book keeping. As I write in the above paragraph accounting of business financial transactions is an art of collection, evaluation, analyzing, recording and presenting to the business management and stakeholders. That complete process is based on some steps of activates which are commonly known as accounting cycle. That Accounting Cycle is consist of 7 different steps which are Source Data, Journal, Ledger, Trial Balance, Adjustment, Closing Accountings and Stock Valuation and Preparation of Fina...

Accountancy & Financial matters Management blogs

Search This Blog