Presentation on theme: "Basic Cost Concepts COST ACCOUNTING Chapter One. LEARNING OBJECTIVES To understand the meaning of different costing terms To understand different."— Presentation transcript:
LEARNING OBJECTIVES To understand the meaning of different costing terms To understand different costing methods To have a basic idea of different costing techniques To understand the meaning of cost sheet
COST ACCOUNTING Cost accounting refers to the process of determining and accumulating the cost of some particular product or activity. It also covers classification, analysis and interpretation of costs.
OBJECTIVES OF COST ACCOUNTING To determine cost and control efficiency To Facilitate preparation of financial and other statement To provide basis for operating policy
Cost Accounting Vs. Financial Accounting accounting is prepared for the internal users. Financial accounting is concerned with providing information to external users. But cost
Role of Cost Accounting Cost accounting furnishes management with the necessary accounting tolls for planning and controlling activities. Specifically, the collection, presentation, and analysis of cost data should help management accomplish the following tasks:
Role of Cost Accounting Creating and executing plans for budget Establishing costing methods and procedures. Creating inventory values for costing and pricing
Role of Cost Accounting Determining company costs and profit for and annual accounting period. Choosing from among two or more alternatives which might increase revenues or decrease costs. Determining company costs and profit for and annual accounting period. Choosing from among two or more alternatives which might increase revenues or decrease costs.