accounting definition of material cost
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- Definition: a cost of materials or supplies used, or an aggregate of such costs. A material cost may be either a ‘direct material cost’ or an ‘indirect material cost’ depending on whether it is a direct cost or an indirect cost. An alternative form of the term is ‘materials cost’. material cost may be either a ‘direct material cost’ or an ‘indirect material cost’ depending on whether it is a direct cost or an indirect cost. An alternative form of the term is ‘materials cost’.
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- Fixed costs are those cash expenses that must be paid whether the business produces or sells a single product. Common examples include rent, insurance, salaries and interest. There is a difference between the cost accounting definition and the financial accounting definition.
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Lesson 7: Cost and Cost Components Indirect costs: also referred to as soft costs, include expenditures other than labor and material necessary to make the equipment ready for its intended use. Components In valuing personal property and fixtures, it is important to be aware of all cost components.
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- Curcumin Forte. (Curcuma longa) has almost twice as much Curcuminoids, the most active ingredient in the extract. Curcumin and Alzheimer's Disease. Curcumin blocks the Tumor Necrosis Factor (TNF); in addition it crosses the blood-brain-barrier which can make it extremely useful in combating brain cancer.
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Definition and Explanation of Standard Costing: Definition and Explanation of Standard Costing: A standard cost is the predetermined cost of manufacturing a single unit or a number of product units during a specific period in the immediate future. It is the planned cost of a product under current and/or anticipated operating conditions. A standard cost has two components: a standard and a cost. A standard is like a norm and whatever is considered normal can generally be accepted as standard. For example, if a score of 72 is the standard for a golf course, a golfer's score is judged on the basis of this standard.
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- Cost accounting is a process of collecting, analyzing, summarizing and evaluating various alternative courses of action. Its goal is to advise the management on the most appropriate course of action based on the cost efficiency and capability.Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future. In financial accounting, cost classification based on type of transactions, e.g. salaries, repairs, insurance, stores etc. 2  In cost accounting, classification is basically on the basis of functions, activities, products, process and on internal planning and control and information needs of the organization.
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U.S. National Library of Medicine The economic definition of cost (also known as opportunity cost) is the value of opportunity forgone, strictly the best opportunity forgone, as a result of engaging resources in an activity. Note that there can be a cost without the exchange of money.
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What is 'Production Cost' DEFINITION of 'Production Cost'. A cost incurred by a business when manufacturing a good or producing a service. Production costs combine raw material and labor.To figure out the cost of production per unit, the cost of production is divided by the number of units produced.n production, there are direct costs and indirect costs. For example, direct costs for manufacturing an automobile are materials such as the plastic, metal or labor incurred to produce such an item.
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What is a 'Historical Cost' What is a 'Historical Cost'. A historical cost is a measure of value used in accounting in which the price of an asset on the balance sheet is based on its nominal or original cost when acquired by the company. The historical-cost method is used for assets in the United States under generally accepted accounting principles (GAAP).
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- Cost: The total money, time, and resources associated with a purchase or activity. Fixed cost: Includes all costs that do not vary with activity for an accounting period. Fixed costs are, at any time, the inevitable costs that must be paid regardless of the level. of output and of the resources used.
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- Noun. 1. cost accountant-a specialist in the systematic recording and analysis of the costs incident to production. accountant, comptroller, controller-someone who maintains and audits business accounts.
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Cost accounting Cost accounting is a process of collecting, recording, classifying, analyzing, summarizing, allocating and evaluating various alternative courses of action & control of costs. Its goal is to advise the management on the most appropriate course of action based on the cost efficiency and capability. Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future.
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- DEFINITION of 'Historical Cost'. A measure of value used in accounting in which the price of an asset on the balance sheet is based on its nominal or original cost when acquired by the company. The historical-cost method is used for assets in the U.S. under generally accepted accounting principals (GAAP).
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Materiality Concept A large and material expense to a small company might be small an immaterial to a large company because of their size and revenue. The main question that the materiality concept addresses is does the financial information make a difference to financial statement users. If not, the company doesn't have to worry about including it in their financial statements because it is immaterial.
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What is cost accounting? Cost accounting involves the techniques for: For example, cost accounting is used to compute the unit cost of a manufacturer's products in order to report the cost of inventory on its balance sheet and the cost of goods sold on its income statement.
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What is 'Cost Accounting' DEFINITION of 'Cost Accounting'. Cost accounting is a type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step of production as well as fixed costs such as depreciation of capital equipment.hile cost accounting is often used within a company to aid in decision making, financial accounting is what the outside investor community typically sees.
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What is cost accounting? Cost accounting is a system of operational analysis for management. The Scope and Nature of Cost Accounting. Even though cost accounting is commonly referred to as a costing method, the scope of cost accounting is broader than just costing.
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- In managerial accounting, prime cost is the sum of direct costs needed to make a product and includes direct materials, direct ...
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- DEFINITION of 'Relevant Cost'. A managerial accounting term that is used to describe costs that are specific to management's decisions. The concept of relevant costs eliminates unnecessary data that could complicate the decision-making process. Next Up.
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What is 'Cost Accounting' Cost accounting is a type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step of production as well as fixed costs such as depreciation of capital equipment.
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Direct material cost Direct material cost is the cost of the raw materials and components used to create a product. The materials must be easily identifiable with the resulting product (otherwise they are considered to be joint costs). The direct material cost is one of the few variable costs involved in the production process; as such, it is used in the derivation of throughput from production processes. Throughput is sales minus all totally variable expenses. Examples of direct materials are: 1  The timber used to construct a house. 2  The steel included in an automobile. 3  The circuit board included in a radio. 4  The fabric used to assemble clothing.
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What is 'Cost Accounting' Cost Accounting. Loading the player... What is 'Cost Accounting'. Cost accounting is a type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step of production as well as fixed costs such as depreciation of capital equipment.
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Fixed cost This is in contrast to variable costs, which are volume-related (and are paid per quantity produced). In management accounting, fixed costs are defined as expenses that do not change as a function of the activity of a business, within the relevant period.For example, a retailer must pay rent and utility bills irrespective of sales.In marketing, it is necessary to know how costs divide between variable and fixed.his is in contrast to variable costs, which are volume-related (and are paid per quantity produced). In management accounting, fixed costs are defined as expenses that do not change as a function of the activity of a business, within the relevant period.
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materiality principle materiality principle. Definition. An accounting principle that states that financial reports only need to include information that will be significant (material) to their users. For example, an audit report would not need to specify the number of paper clips used by a bank.
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What is 'Cost Accounting' DEFINITION of 'Cost Accounting'. Cost accounting is a type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step of production as well as fixed costs such as depreciation of capital equipment.
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accounting cost Noun [edit]. accounting cost ‎(plural accounting costs). ( 1 economics) The total amount of money or goods expended in an endeavour. 2  It is money paid out at some time in the past and recorded in journal entries and ledgers.oun [edit]. accounting cost ‎(plural accounting costs). ( 1 economics) The total amount of money or goods expended in an endeavour. 2  It is money paid out at some time in the past and recorded in journal entries and ledgers.