# Summary: Samenvatting Fidm

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## Read the summary and the most important questions on Samenvatting FIDM

• ### 1 Eigen flashcards lecture 1, 2, 3

This is a preview. There are 18 more flashcards available for chapter 1

• #### Indirect costs are related to a particular cost object but cannot be traced to it because

- cost element is shared among cost objects (common costs)
- physically impossible to trace
- not cost effective to trace
• #### Criticism traditional allocation method

- Assumes all overhead is volume related
- Organization-wide or departmental rates all related to single activity measure
- Departmental focus, not process focus
- Focus on costs incurred, not cause of costs

• #### Cost allocations act as

an internal tax system
• #### Joint costing: Physical measurement method

Determine weighing of joint cost allocated accordingly with production in kg
• #### Joint costing: Sales value at split-off method

Determine weighing of joint cost allocated accordingly with sales value
• #### Variable costing (=direct costing/marginal costing)

Excludes fixed costs from product costs and writes them off in the year that the costs are incurred.
Operating income = sales x (price - full costs) + (actual production - normal production) x fixed OH rate
• #### Dysfunctional effect under absorption costing:

- Managers can defer recognition of fixed manufacturing costs by building ending inventory
- Incentive to over-produce
• #### For which type of costing does level of sales determine break-even point

Variable costing
• #### Examples batch-related activities

set-ups, purchase ordering and first-item inspection activities