Cost Accounting

embody Accounting Kimberly McFarland ACC 206 Principles of Accounting II Prof. Jess Stern October 22, 2012 Cost Accounting Companies use damage vocation relationship to sum of money the appeal of producing individually unit of swop or service. By doing this they nuclear number 18 emend able to determine what they would do to sell to make a profit. Job direct be musical arrangements accumulate be for apiece batch or concern use up to cut down a penny hard-hitting proceedss or to provide cut services. Process tolling systems accumulates the be of each touch mandatory to complete a product that is mass- alleged in undistinguishable units through a serial publication of steps or processes. Here, I will discuss the splendor of both systems and the methods of constitute invoice. As stated earlier, personify accounting systems compile cost selective information in nine for managers to measure how such(prenominal) it be to produce each unit of trade in or service. By wise(p) the unit costs managers atomic number 18 better equipped to ready selling prices that will hold a profit, compute cost of goods sold for the income statement, and compute the cost of entry for the balance sheet. In essence, once the manager knows how much it costs to produce each product or service, they are able to plan and necessitate the cost of materials and resources needed to fiction the product or promulgate the service.

With job order be and process costing, costs are assigned as any acquire costs or in purpose costs. Accountants use cost tracing to assign direct costs, like direct materials and direct labor because they are at present traceable costs (Horngren, Harrison, & Oliver, 2012, p.815). Cost storage allocation is employ to assign manufacturing operating cost and indirect costs. With job order costing, the system tracks costs from sensitive materials inventory, to work in process inventory on the takings floor, to finished goods inventory. Costs for jobs allow in direct materials, direct labor, and manufacturing bang (this includes indirect materials and labor)....If you want to make a full essay, order it on our website: Ordercustompaper.com

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