Cost Assignment or Cost Attribution refers to the procedures by which direct or indirect costs are charged to or made the responsibility of particular cost centers, and ultimately charged to the products manufactured or services provided by the organization.
Cost classification is the process of grouping expenditures according to common characteristics, facilitating the proper allocation and management of expenses within an organization.
Cost estimation is the process of predicting the cost of a project, product, or service by assessing the unit costs of direct costs and overheads for the purposes of planning, control, and pricing.
Cost of Goods Sold (COGS) represents the direct costs attributed to the production of goods sold by a company. COGS include the cost of materials, direct labor, and manufacturing overhead.
A key financial metric representing the direct costs to an organization of supplying goods or services, used to calculate gross profit by deducting this figure from sales revenue.
Cost tracing refers to the process of directly associating costs with specific cost objects such as projects, departments, or products, ensuring more accurate tracking of financial performance.
Product costs that can be directly traced to a product or cost unit. They encompass direct materials, direct labor, and direct expenses that are attributable to the product without the need for cost apportionment.
Direct expenses are expenditures that are directly attributable to the production of a particular cost unit, excluding direct labor and materials.
Analyzing direct and indirect costs associated with marketing a product or service in a specific area.
The Full Costing Method is an extensive approach in accounting that includes all the costs associated with producing a product or service, encompassing both direct costs and overheads allocated to the cost unit.
Manufacturing expenses, often referred to as manufacturing costs, encompass all the financial expenditures required to produce goods. These costs are crucial for businesses as they significantly impact pricing, budgeting, and overall profitability.
Marginal cost represents the cost of producing one additional unit of a product. It includes both direct costs and variable overhead costs associated with the production process.
The costs of production when charged to the cost units and expressed as costs of individual products. Product costs may include both direct costs and indirect costs (overhead); many different costing methods, such as absorption costing, activity-based costing, and process costing, are used in computing product costs.
