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    Ma2 1

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    Shikhar Srivastava
    The document defines key cost accounting terms like cost, cost object, cost center, cost unit, and methods of accumulating, allocating, apportioning, and absorbing costs. It also outlines different costing methods like job, contract, batch, process, and unit costing. Costs are classified by elements, behavior, function, normality, and for financial and managerial decision making purposes.

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    Ma2 1

    Uploaded by

    Shikhar Srivastava
    11 views6 pages
    The document defines key cost accounting terms like cost, cost object, cost center, cost unit, and methods of accumulating, allocating, apportioning, and absorbing costs. It also outlines different costing methods like job, contract, batch, process, and unit costing. Costs are classified by elements, behavior, function, normality, and for financial and managerial decision making purposes.

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    Ma2-1

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    The document defines key cost accounting terms like cost, cost object, cost center, cost unit, and methods of accumulating, allocating, apportioning, and absorbing costs. It also outlines different costing methods like job, contract, batch, process, and unit costing. Costs are classified by elements, behavior, function, normality, and for financial and managerial decision making purposes.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    11 views6 pages

    Ma2 1

    Uploaded by

    Shikhar Srivastava
    The document defines key cost accounting terms like cost, cost object, cost center, cost unit, and methods of accumulating, allocating, apportioning, and absorbing costs. It also outlines different costing methods like job, contract, batch, process, and unit costing. Costs are classified by elements, behavior, function, normality, and for financial and managerial decision making purposes.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 6

    Basic Cost Terms

    Cost
     It is the amount of expenditure, actual or notional, relating to
    a specific thing or activity. The same can be a product, job,
    service process or any other activity. It is the amount of
    resources sacrificed or foregone to achieve a specified
    objective.

    Cost Object
    Any activity or item for which a separate measurement of
    costs is desired

    Cost Centre
    A location, function or items of equipment in respect of which
    cost may be ascertained and related to cost units for control
    purposes.
    Cost Unit
     A quantitative unit of product or service in relation to which cost
    are ascertained.
    Cost Accumulation
     It is the process of collecting cost data through an
    accounting system.
    Cost Allocation
     It is the charging of discrete, identifiable items of cost to cost
    centre's or cost units.
    Cost Apportionment
     It is the allotment to two or more cost centre's of proportions of
    the common items of cost on the estimated basis of benefit
    received .
    Cost Absorption
     It is the method of assigning common costs to cost units on
    some equitable basis.
    Cost Driver
     It is a factor which influences the cost of a cost object
    Methods of Costing
    • JOB COSTING
    • CONTRACT COSTING
    • BATCH COSTING
    • PROCESS COSTING
    • UNIT COSTING
    • OPERATING COSTING
    • OPERATION COSTING
    • MULTIPLE COSTING
    Techniques of Costing
    • UNIFORM COSTING
    • MARGINAL COSTING
    • STANDARD COSTING
    • HISTORICAL COSTING
    • ABSORBTION COSTING
    Cost Classification
    • Elements
     Material
     Labour
     Overhead

    • Behaviour Pattern
     Fixed Cost
     Variable Cost
     Semi Variable Cost

    • Function Wise
     Product Cost
     Administrative Cost
     Selling Cost
     Distribution Cost
     Research & Development Cost
    • Normality
     Normal Cost
     Abnormal Cost

    • Financial accounting classification


     Capitalized Cost
     Production Cost
     Period Costs

    • Managerial decision making


     Marginal Cost
     Sunk Cost
     Committed Costs
     Opportunity Cost
     Incremental Cost
     Avoidable & Unavoidable Cost
     Controllable & Non Controllable Costs

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