Archive | Cost Accounting

Controllable costs are those costs which can be regulated or controlled by specified member of an undertaking.

Cost centres are the smallest segment of activity or area of responsibility for which costs are accumulated or ascertained.

Wages paid to the direct laborer is called direct labor or direct wages, or productive wages or manufacturing wages.

Different industries follow different methods for ascertaining cost of their products. The method to be adopted by business organisation will depend on the nature of the production and the type of out put.

Cost Accounting is a branch of accounting which consists of the activities of cost ascertainments, cost analysis, cost recording and cost reporting mainly in the operations of the factory.

Cost centres are the smallest segment of activity or area of responsibility for which costs are accumulated or ascertained. I.C.M.A.

Product costs are also called variable costs. It refers to that cost which varies in direct proportion to the volume of output.

Differential cost is the aggregate of change in fixed cost and variable cost which takes place due to the adoption of alternative course of action or change in the volume of out put.

Sunk cost is the past cost which is not recoverable. Its written down value is less than its salvage value.

Cost unit is a device for the purpose of breaking up cost in to smaller sub-divisions.

A profit centre is that segment of activity of a business which is responsible for both revenue and expenses and discloses profits of a particular segment of activity.

Cost centres are the smallest segments of activity or area of responsibility for which costs are accumulated or ascertained.

The following factors are to be considered before installation of cost accounting system:

Cost accounting is not free from limitations. The main limitations of cost accounting are as follows;

The following are the important limitations of financial accounting:

The Difference Between Cost Accounting and Financial Accounting are as follows: