Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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Multiple Choice

The standard overhead rate is computed separately for:

Depreciation and amortization

Direct materials and direct labor

Variable and fixed overhead costs

Selling and administrative expenses

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Verified step by step guidance

Understand the concept of overhead costs: Overhead costs are indirect costs that cannot be directly traced to a specific product or service. These are categorized into variable overhead costs (which change with production levels) and fixed overhead costs (which remain constant regardless of production levels).

Recognize the purpose of the standard overhead rate: The standard overhead rate is used to allocate overhead costs to products or services based on a predetermined rate, ensuring accurate cost accounting and budgeting.

Identify the components of the standard overhead rate: The rate is computed separately for variable overhead costs (e.g., utilities, indirect materials) and fixed overhead costs (e.g., depreciation, rent). These components are essential for understanding the total overhead allocation.

Calculate the standard overhead rate: To compute the rate, divide the total estimated overhead costs (variable and fixed) by the estimated activity level (e.g., machine hours, labor hours). The formula is:

\frac{Total Estimated Overhead}{Estimated Activity Level}

Apply the standard overhead rate: Once calculated, use the rate to allocate overhead costs to products or services based on the actual activity level incurred during production.