Sunday, 24 June 2018
Cost Concepts and Classifications In Cost Accounting
Cost Concepts and Classification In Cost Accounting
Cost Accounting like other management sciences has
principles or concepts that guide the preparation of cost statement or
information such rules trough not statutory in nature are generally accepted
and applied in the preparation of cost information.
The rules include:
Nature, Elements and Classification of Cost
Types of Cost
Cost could either be fixed, variable or
semi-variable
i. Fixed Cost: is any
cost or expenses that are fixed irrespective of the level of activities attained.
Fixed cost per unit decrease as output increases. Examples are rent of factory
building, managerial salary etc.
ii. Variable
Cost: Is any cost or an expense that varies with the level of activities,
variable cost per unit remains constant. Examples of variable cost are raw
material, wages
etc.
Wednesday, 20 June 2018
The Human Elements and Current Issues in Business
THE HUMAN ELEMENTS IN BUSINESS
The human elements in business are very important because business itself depends on people as investors, customer’s employees and as managers.Individuals too depend on business to provide them with goods and services to satisfy their needs and wants. At every stage of business, people are involved as Investors, employees’, customers or managers. Businesses themselves are a group of people who seek to earn profit by providing goods and services to others. Hence, it is essential to understand the different roles these individuals play.
Definition, Scope, Purpose and Methods of Cost Accounting.
Definition
Cost may be defined as the amount of cash equivalent
or the fair value of other consideration given to acquire an asset at the time
of its acquisition or construction.
To the economists, cost is what must be given up in
order to obtain something. Accountants, extending the perspective of economist,
view cost as the value of economic resources used in the production of goods,
services, income or profit. Accounting is a term desired from account and which
is simply defined as an expression of transaction.
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