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The processes where we collect, classify, categorize, organize, analyze, record, summarize, allocate and verify various alternative courses of action and control of costs. It is a type of accounting in which the objective is to capture a company’s cost of production by analyzing the input costs of each step of production as well as fixed costs such as depreciation of capital equipment. It also tries to guide the management on an appropriate course of action to take the necessary steps that will be most suitable for cost efficiency. The various types of detailed information regarding the costs that a company needs for the control of current tasks and the plans for the future are controlled by cost accounting. The detailed description and analysis of Concept of Cost Accounting is given by Concept of Cost Accounting Assignment Help.
Types of Cost Accounting
The different types of cost accounting explained in Concept of Cost Accounting Assignment Help are
Standard Cost Accounting
It is a conventional method of cost accounting. It first came into the forum in 1920s. It was used as an alternative for the traditional method which was based on historical costs. It basically makes use of the ratios that are called efficiencies. After that it uses these to compare the labour and materials that are actually used to produce a good with those that the same goods and materials would have required under normal standardized conditions.
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Activity Based Cost Accounting
It is a method of cost accounting in which the identification of various activities within an organisation is carried out. It also assigns the cost of each activity along with resources to all products and services with respect to the actual consumption by each. It analyzes all the products and then eliminates those which are found to be unprofitable. It also lowers the prices of those goods which are overpriced. Activity based costing can be studied in Concept of Cost Accounting Assignment Help.
Resource Consumption Cost Accounting
It is another method of accounting that is basically a management theory describing a dynamic, comprehensive and integrated management approach that provides the mangers with decision support information for optimization of the enterprise. It uses the fixed and proportional costs established at the resource level in a company.
It is a simplified management approach. It is principle based and it also provides the managers with the decision support information that is necessary for the improvement of the enterprise profitability. It’s a new type of management accounting approach that helps the management in identifying the factors that deprive an organization from reaching its goal. The various techniques can be understood and materials can be provided by Concept of Cost Accounting Assignment Help.
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