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Cards In This Set
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Cost of sales equals
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Beginning finished goods plus cost of goods manufactured less ending finished goods
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Cost of goods manufactures equals
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Beginning work in progress plus direct materials plus direct labor plus factory overhead less ending work in process
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Selling expenses includes
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Advertising, sales salaries and commissions, rent for office space occupied by sales department, freight out
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General and administrative expense include
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Accounting and legal fees, officers salaries, rent for office space
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Is interest and loss on sale of long term investment operating items or non-operating items.
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They are non-operating items.
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Operating expenses are divided into two categories namely
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Selling expenses and general and administrative expenses
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Selling expenses relate to
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Sales of a company's products
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General and administration expenses relate to
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Company's general operations
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Freight in is an
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Inventoriable cost which should be reflected in cost of goods sold and ending inventory
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Freight out i.e. is the cost of delivering goods to customers is included in
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Selling expense
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Interest expense is included in
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Other expenses and losses as it is considered non-operating.
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Extraordinary items are material gains and losses which are both
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Unusual in nature and infrequent in occurrence.
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Is the effect of strike and a gain or loss from sale or abandonment considered extraordinary?
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No. They are not considered extraordinary because they are not unusual in nature.
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Is disposal of plant assets, foreign currency losses and inventory losses considered extra ordinary?
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No. They are not considered extraordinary because they are not unusual in nature.
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Is foreign currency losses and losses due to discontinued operations considered extraordinary?
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No. They are not considered extraordinary because they are not unusual in nature.
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