How to choose a carpet cleaning service?
Consider a service company that provides carpet cleaning. Classify the cost of the hourly workers who clean carpets for customers. (Check all that apply.) Variable Direct List the following activities in the order in which they occur, with the first activity on top.
Why do Accountants use the straight line depreciation method?
Accountants use the straight line depreciation method because it is the easiest to compute and can be applied to all long-term assets. However, the straight line method does not accurately reflect the difference in usage of an asset and may not be the most appropriate value calculation method for some depreciable assets.
What are the different methods of asset depreciation?
Different methods of asset depreciation are used to more accurately reflect the depreciation and current value of an asset. A company may elect to use one depreciation method over another in order to gain tax or cash flow advantages. 1. Double-declining balance method
How do you calculate depreciation on a commercial property?
Subtract the estimated salvage value of the asset from the cost of the asset to get the total depreciable amount. Determine the useful life of the asset. Divide the sum of step (2) by the number arrived at in step (3) to get the annual depreciation
What is direct materials cost?
Direct materials costs are expenditures for direct materials that are separately and readily traced through manufacturing process to finished goods. Ex. of direct materials in manufacturing a mountain bike include its tires, seat, frame, pedals, brakes, cables, gears, and handlebars. Direct labor.
Why are product costs capitalized?
Product costs. Costs that are capitalized because they are expected to have future value. Those costs necessary to create a product and consist of: direct materials, direct labor, and factory overhead. Overhead refers to production costs other than direct materials and direct labor. Product costs are capitalized as inventory during ...
What is Schedule of Cost of Goods Manufactured?
Also called manufacturing statement or a statement of cost of goods manufactured. Schedule of cost of goods manufactured summarizes types and amounts of costs incurred in the manufacturing process. 1.
What is the process of setting goals and making plans to achieve them?
Planning. Process of setting goals and making plans to achieve them. Companies make long-term strategic plans that span 5 to 10 year horizon. Short-term plans translate strategic plan into actions, which are more concrete and consist of better-defined goals.
What is the goal of a lean business model?
Lean business model. Goal is to eliminate waste while "satisfying the customer" and "providing a positive return" to the company. Continuous improvement. Rejects notions of good enough or acceptable and challenges employees and managers to continuously experiment with new and improved business practices.
What are the different types of depreciation methods?
Depreciation Methods The most common types of depreciation methods include straight-line, double declining balance, units of production, and sum of years digits.
Why do accountants use the straight line method?
Accountants use the straight line depreciation method because it is the easiest to compute and can be applied to all long-term assets. However, the straight line method does not accurately reflect the difference in usage of an asset and may not be the most appropriate value calculation method for some depreciable assets.
What is salvage value?
Salvage value is also known as scrap value. . Straight line depreciation is the most commonly used and straightforward depreciation method. Depreciation Expense When a long-term asset is purchased, it should be capitalized instead of being expensed in the accounting period it is purchased in. for allocating the cost of a capital asset.
What is depreciation expense?
Depreciation expense is used in accounting to allocate the cost of a tangible asset over its useful life. of an asset. Different methods of asset depreciation are used to more accurately reflect the depreciation and current value of an asset.
Is depreciation higher in periods of high usage or low usage?
Therefore, depreciation would be higher in periods of high usage and lower in periods of low usage.