About This Chapter
Cost Estimation - Chapter Summary
Before organizations decide to risk a lot of money, they forecast potential costs and returns on investments using cost estimation. This chapter elaborates on how cost estimations are made, including an explanation of related methodologies and analysis strategies. Most lessons can be completed within 5-10 minutes, so you can fit your studying into even the busiest of schedules. After you complete the chapter, you'll be prepared to do the following:
- Describe the significance of project cost management
- Identify effective techniques for estimations and planning
- Define key techniques for project cost management
- Examine the uses of the variance analysis model
- Explain the formula for high-low method accounting
- Use a scatter graph to estimate costs
- Employ regression analysis to achieve certain goals
1. What is Project Cost Management? - Definition & Importance
Project cost management is all of the activities that ensure a project stays on budget. In this lesson, we'll look at the steps in project cost management and its importance in business.
2. Project Cost Management: Planning & Estimation
Project cost management includes activities to estimate, monitor, and control project costs. In this lesson, we'll look at the two elements of project cost management: estimating and planning.
3. Project Cost Management Techniques
Project cost management techniques are designed to ensure a project stays on budget. In this lesson, we'll look at the different techniques used in estimating, monitoring, and controlling project costs.
4. Variance Analysis Model in Accounting
Budgets and variances are useful, but if you really want to see just how effective your organization is at making use of that information, then you're going to want to learn about variance analysis modeling.
5. High-Low Method Accounting: Formula & Examples
The high-low method is one type of cost-volume analysis used in accounting. This lesson describes how it is used and explains the formula for quickly computing an estimated cost per unit.
6. How to Estimate Costs Using the Scatter Graph Method
A scatter graph is a graph that shows how a cost differs at various activity levels. From a scatter graph, you can develop a mixed cost equation that will enable you to estimate the amount of the cost for future periods.
7. Using Regression Analysis in Business
Statistical analyses and models, like regression analysis, can be extremely helpful when businesses need to forecast their financials and product demand. In this lesson, we'll learn how regression analysis can help accomplish these goals.
Earning College Credit
Did you know… We have over 200 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.
To learn more, visit our Earning Credit Page
Transferring credit to the school of your choice
Not sure what college you want to attend yet? Study.com has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.
Other chapters within the Accounting 303: Cost Accounting course
- Cost Classifications in Accounting
- Costing Methods & Techniques
- Formulas for Cost Accounting
- Standard Costs in Accounting
- Job Order Cost System in Accounting
- Process Cost System in Accounting
- Activity-Based Costing Overview
- Product & Service Costing
- Budgetary Process
- Cost Behavior Analysis
- Cost-Volume-Profit Analysis Overview
- Service Department & Joint Cost Allocation
- Cost Accounting for Decision Making
- Ethics in Cost Accounting
- Modern Trends in Accounting
- Required Assignments for Accounting 303
- Studying for Accounting 303