Cost Accounting
Cost accounting is a branch of accounting which deals with cost incurred at the time of production as well as the cost of depreciation of fixed assets. Cost accounting helps in decision making of the company. Cost accounting is also helpful in budgeting management of company.
Job Order Costing System Definition: A costing system used in situations where many different products, jobs, or services are produced each period. Click here to read detailed about job order costing system Recommended Books ! Or Download E accounting book in MS-word format
Job Order Costing Questions and Answers: Questions: Cost accounting is said to consist of three different phases. Name them. See answer. Name four control accounts concerned primarily with cost determination. See answer. What subsidiary record or ledger supports each of the control accounts mentioned
Job Cost Sheet Definition: A form prepared for each job that records the materials, labor, and overhead costs charged to the job.
Income Statement Definition: Income statement is the summary of a management’s performance as reflected in the profitability (or lack of it) of a firm over a certain period. It itemizes the revenues and expenses of past that led to the current profit or loss,
Human Skills Definition: Human skills involve the ability to work well with other people both individually and in group. Because managers deal directly with people, this skill is crucial! Managers with good human skills are able to get the best out of their people.
Impact of Just In Time (JIT) Inventory Methods on Variable and Absorption Costing System: Learning Objectives: Why net operating income figure under variable costing and absorption costing systems are almost same when companies use just in time manufacturing and inventory control system? Variable costing
Horizontal/Trend Analysis Definition: A side-by-side comparison of two or more years’ financial statements. Click here to read full article about horizontal or trend analysis. Relevant terms: Vertical Analysis
High-Low Point Method Definition: A method of separating a mixed cost into its fixed and variable elements by analyzing the change in cost between the high and low levels of activity.
Half-Year Convention Definition: A requirement under the Modified Accelerated Cost Recovery System (MACRS) that allows a company to take only a half year’s depreciation in the first and last years of an asset’s depreciation period.
Denominator Activity definition: The activity figure used to compute the predetermined overhead rate.
General Environment Definition: Broad external conditions that may affect the organization.
Full Costing Definition: Full costing is a costing method that includes all manufacturing costs – direct materials, direct labor, and both variable and fixed overhead – as part of the cost of a finished unit of product. This term is synonymous with absorption costing.
Flexible Budget Definition: A budget that is designed to cover a range of activity and that can be used to develop budgeted costs at any point within that range to compare to actual costs incurred.
Flexible Budget Definition: A budget that is designed to cover a range of activity and that can be used to develop budgeted costs at any point within that range to compare to actual costs incurred.
Fixed Manufacturing Overhead Cost Deferred in Inventory Definition: The portion of the fixed manufacturing overhead cost of a period that goes into inventory under the absorption costing method as a result of production exceeding sales. Also see: Fixed manufacturing overhead cost released from inventory
Fixed Manufacturing Overhead Cost Released From Inventory Definition: The portion of the fixed manufacturing overhead cost of a prior period that becomes an expense of the current period under the absorption costing method as a result of sales exceeding production.
Fixed Cost Definition: A cost that remains constant, in total, regardless of changes in the level of activity within the relevant range. If a fixed cost is expressed on a per unit basis, it varies inversely with the level of activity.
First Stage Allocation Definition: The process by which overhead costs are assigned to activity cost pools in an activity-based costing system.