BUS 082 Chapter Notes - Chapter 13: Cost Accounting, Cost Driver, Activity-Based Costing

• School: College of The Sequoias
• Department: Business (BUS)
• Course: BUS 082
• Professor: Porterfield

Document Summary

Involves measuring, recording and reporting costs of any cost object. For management decision making (e. g. product pricing) Concerned with all costs incurred to make a product. Need to work out all costs incurred and allocate them to a specific product or. Can be economically and physically traced to specific cost objects (finished goods), e. g. flour for bread. Costs that are not directly accountable to a cost object. Fixed or variable, include administration, personnel and security costs. Expense as cost of goods sold (cogs) when finished products are sold. Not directly part of the manufacturing process. Expensed according to time not specific goods e. g. selling and admin costs. Costs are assigned to each individual job. E. g. printing, legal services, travel, patient healthcare. Each job can be distinguished from all other jobs. Costs are measured according to the job, not time. Allocates the same cost to each of a large volume of the same product. E. g. building materials, dairy products, appliances, oil.