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The process of cost accumulation involves the collection and maintenance of a database of the expenses incurred by a business during the course of its operation using an accounting system. This is done so in an organized and planned fashion with the help of a cost accounting system. Cost accumulation is basically divided into two types: – job order and process costing. Cost accumulation is basically an approach towards product costing that helps in determining which manufacturing costs are recorded as part of the product cost. It can be prove to be beneficial for the external financial statements and tax returns. The methods to accrue costs can be known with the help of cost accumulation. The management and control of various businesses and the expenses related to them are monitored under the cost accumulation process. The detail description and analysis of Cost Accumulation is given by Cost Accumulation Assignment Help.
Different Types of Cost Accumulation Process
The different types of Cost accumulation process explained in Cost Accumulation Assignment Help are
• Job Order: – This type of cost accumulation procedure and process costing finds its applications in many types of manufacturing and business services. It follows the basic manufacturing cost cycle. Each of the jobs in a job order cost accumulation is an accounting unit to which materials, labor and factory overhead costs are assigned with the help of job order numbers. The three main elements included under the job order process of cost accumulation are- direct material, direct labor and factory overhead costs. In this system we trace the direct costs and allocate the indirect costs to unique and distinct jobs instead of departments. Its application can be mainly found for businesses that provide non uniform customized business and services. Job order type of cost accumulation can be further studied in Cost Accumulation Assignment Help.
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• Process Costing: – The process costing system of cost accumulation is basically used when the manufacturing costs are assigned according to processing department or cost center. It is also used when there is a large amount of production of same type of products where the costs that are associated with each of the individual units of output cannot be differentiated from one another. Under this concept of cost accumulation, costs are accumulated over a stipulated period of time. After that they are summarized and then assigned to all of the units that are produced during that period of time on a regular basis. . The various techniques can be better understood and necessary materials can be provided by Cost Accumulation Assignment Help.
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