Costing Methods & Techniques Flashcards

Costing Methods & Techniques Flashcards
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Overhead Cost
Costs that don't connect directly to one job. This may include salaries for marketing employees, or even CEOs. It can also include payments for utilities and rent.
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Historical Cost Accounting
An accounting process that looks at an item's value based on what it cost in the past. It may be used to compare the past and current costs of an item.
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Environmental Full Cost Accounting
This accounting method looks at a project's environmental, economic and social costs. This means it looks at direct and indirect costs associated with a project.
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Contract Costing
You can use this method of costing to track costs that are connected to individual contracts set up between a company and a single customer. Contractors can make use of this method.
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Cost Driver
This is any activity that exerts control over how many costs your company incurs. It can be used to allocate costs in traditional costing.
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Absorption Costing
A costing method that allows you to assign the costs of manufacturing, including labor, materials and overhead, to specific products.
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13 cards in set

Flashcard Content Overview

The flashcards contained within this set focus on a wide variety of different forms of costing, including:

  • Uniform
  • Variable
  • Process
  • Operations / Service
  • Absorption
  • Contract
  • Multiple / Composite
  • Batch

You can also find cards that go over:

  • Cost accounting
  • Historical cost accounting
  • Environmental full cost accounting

Cost drivers and overhead costs are also discussed by these cards.

Front
Back
Absorption Costing
A costing method that allows you to assign the costs of manufacturing, including labor, materials and overhead, to specific products.
Cost Driver
This is any activity that exerts control over how many costs your company incurs. It can be used to allocate costs in traditional costing.
Contract Costing
You can use this method of costing to track costs that are connected to individual contracts set up between a company and a single customer. Contractors can make use of this method.
Environmental Full Cost Accounting
This accounting method looks at a project's environmental, economic and social costs. This means it looks at direct and indirect costs associated with a project.
Historical Cost Accounting
An accounting process that looks at an item's value based on what it cost in the past. It may be used to compare the past and current costs of an item.
Overhead Cost
Costs that don't connect directly to one job. This may include salaries for marketing employees, or even CEOs. It can also include payments for utilities and rent.
Multiple / Composite Costing
Businesses that use parts processed by other companies in the production of their goods may want to use this type of costing. This allows parts to be costed using a variety of processes.
Batch Costing
This costing method is used when companies produce finished goods in groups. For example, a company may produce 1,000 cherry pies all at once.
Operations / Service Costing
Businesses use this costing method when they utilize process and job costing at the same time.
Process Costing
This costing system assigns costs to individual parts of a manufacturing process, such as assembly and packaging. It allows companies to assess costs at different manufacturing stages.
Cost Accounting
The form of accounting that collects, analyzes and organizes a company's financial data internally. It focuses on the following elements: direct labor, direct materials and direct overhead.
Uniform Costing
This financial activity allows the businesses in a specific industry to be compared through the use of standardization. It may utilize gross profit margin to report profits.
Variable Costing
You can use this costing method to look at how production relates to your costs. It can help you assess how many costs are associated with different levels of production.

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