100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Previously searched by you
Previously searched by you
logo
Summary An Introduction to Cost Terms CA$3.67   Add to cart
Quickly navigate to
Preview
  2.  
  3. Universitas Indonesia
  4.  
  5. Accounting
  6.  
  7. Cost Accounting

Summary

Summary An Introduction to Cost Terms
 3 views  0 purchase
  • Course
  • Cost Accounting
  • Institution
  • Universitas Indonesia
  • Book
  • Cost Accounting; a Managerial Emphasis

It contains summary of chapter 2 of "Cost Accounting: A Managerial Approach" book from Charles T. Horngren, Srikant M. Datar, and Madhav V. Rajan. It is written concisely in 2 pages, based on learning objectives of the chapter.

Preview 1 out of 2  pages

Document information

  • No
  • Chapter 2
  • October 29, 2022
  • 2
  • 2017/2018
  • Summary

Subjects

  • cost
  • cost term
  • horngren
  • cost accounting
  • management accounting
  • management accountant
  • cost object
  • direct cost
  • indirect cost
  • cost behavior
  • variable cost
  • fixed cost
  • unit cost
  • inventoriable cost
  • period cos

Connected book

book image

Book Title:

Author(s):

  • Edition:
  • ISBN:
  • Edition:

More summaries for

  • Test Bank for Horngren's Cost Accounting A Managerial Emphasis 8th Canadian ... Solution Manual For Cost Accounting, 14th Edition, By Charles T. Horngren
  • Cost Allocation - Direct Step-down and Reciprocal Method
All for this textbook (3)

Written for

  • Universitas Indonesia
  • Accounting
  • Cost Accounting
All documents for this subject (4)

Seller

avatar-seller
kennywiyarta

Content preview

CHAPTER 2: AN INTRODUCTION TO COST TERMS AND PURPOSES


Document Type : Book Summary
Source : Cost Accounting: A Managerial Emphasis 15th Edition by Charles T.
Horngren, Srikant M. Datar, and Madhav V. Rajan




Learning Objective 1 : Define and Illustrate a Cost Object
Cost object is anything for which a cost measurement is desired. It can be in the form of
products, services, projects, customers, activities, or even departments.


Learning Objective 2 : Distinguish between Direct Costs and Indirect Costs
 Direct costs of a cost object are related to the particular cost object and can be traced
to it in an economically feasible (cost-effective) way. The assignment of direct costs to
a particular cost object is called “cost tracing”; while
 Indirect costs of a cost object are related to the particular cost object but cannot be
traced to it in an economically feasible (cost-effective) way. The assignment of
indirect costs to a particular cost object is called “cost allocation”.


Learning Objective 3 : Explain Variable Costs and Fixed Costs
Based on cost-behavior patterns, costs can be classified as either:
 Variable costs, which change in total in proportion to changes in the related level of
total activity or volume of output produced; or
 Fixed costs, which remain unchanged in total for a given time period, despite wide
changes in the related level of total activity or volume of output produced.


Learning Objective 4 : Interpret Unit Costs Cautiously
A unit cost is calculated by dividing the total cost by the related number of units produced.
Unit costs are found in all areas of the value chain. By summing unit costs throughout the
value chain, managers calculate the unit cost of the different products or services they
deliver and determine the profitability of each product or service. Although unit costs are
regularly used in financial reports and for making product mix and pricing decisions,
managers should think in terms of total costs rather than unit costs for many decisions.

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller kennywiyarta. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for CA$3.67. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

77254 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling
CA$3.67
  • (0)
  Add to cart