Cost accounting models
They include: Standard cost accounting.
Activity-based cost accounting.
Marginal cost accounting..
Methods of costing
Follow the 5 steps for process costing.
Analyze inventory flow.Convert in-process inventory to equivalent units.Compute all applicable costs.Calculate the cost per unit of finished and in-process inventory.Allocate costs to units of finished and in-process inventory..Methods of costing
Concept of Cost in Cost Accounting
The concept of cost is a key concept in Economics.
It refers to the amount of payment made to acquire any goods and services.
In a simpler way, the concept of cost is a financial valuation of resources, materials, risks, time and utilities consumed to purchase goods and services..
What are cost methods accounting?
The cost method of accounting is used for recording certain investments in a company's financial statements.
This method is used when the investor exerts little or no influence over the investment that it owns, which is typically represented as owning less than 20% of the company..
What are the different costing techniques?
Unit Costing: These include the cost which occurs for a specific quantity.
Batch Costing: These include the cost which occurs for a batch of products with a fixed number of units.
Process Costing: Under this type of cost, one can easily distinguish the types of processes involved..
What are the techniques of cost analysis?
There are four main types of cost analysis: cost-feasibility, cost-effectiveness, cost-benefit (also referred to as benefit-cost), and cost-utility.
Each type of analysis uses the same initial approach to assess resource costs but answers different questions..
What is standard cost accounting techniques?
Standard costing is a technique where the firm compares the costs that were incurred for the production of the goods and the costs that should have been incurred for the same.
Essentially it is the comparison between actual costs and standard costs.
The differences between the two are variances..
What is the current cost accounting technique?
Current Cost Accounting (CCA)
The CCA approach values assets at their fair market value (FMV) rather than historical cost, the price incurred during the purchase of the fixed asset.
Under the CCA method, both monetary and nonmonetary items are restated to current values..
