CA_Final_-_Cost_Accounting_Theory - CHAPTER 1 BASIC...

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Unformatted text preview: CHAPTER 1 BASIC CONCEPTS Students Tip- Students should prepare this chapter thoroughly from two view points, namely, one in every examination some marks are attributed to this chapter and two, unless students understand the concepts discussed here, they will not be able to grasp the following chapters easily. SYNOPSIS : 1. Cost Accountancy 2. Cost Accounting 2.1 Definition of Cost Accounting 2.2 Objectives of Cost Accounting 2.3 Importance of Cost Accounting 2.4 Advantages of Cost Accounting 2.5 Limitations of Cost Accounting 2.6 Reports Generated by Cost Accounting Department 3. Installation of Cost Accounting System 3.1 Basic Considerations 3.2 Steps in Introduction 3.3 Essentials of a Good Cost Accounting System 3.4 Difficulties in Introduction 4. Role of a Cost Accountant 5. Cost Accounting, Financial Accounting & Management Accounting 5.1 Cost Accounting and Financial Accounting 5.2 Cost Accounting and Management Accounting 6. Cost - Concepts and Terms 6.1 Cost 6.2 Pre-determined Cost 6.3 Standard Cost 6.4 Estimated Cost 6.5 Marginal Cost 6.6 Differential Cost 6.7 Discretionary Cost 6.8 Decision Driven Cost 6.9 Managed / Policy Cost 6.10 Postponable Cost 6.11 Imputed / Notional Cost 6.12 Inventoriable / Product Cost 6.13 Opportunity Cost 6.14 Out-of-pocket Cost 6.15 Joint Cost 6.16 Period Cost 6.17 Sunk Cost 6.18 Committed Cost 6.19 Shut down Cost 6.20 Relevant Cost 6.21 Replacement Cost 6.22 Absolute Cost 6.23 Cost Centre 6.24 Cost Unit 6.25 Cost Allocation 6.26 Cost Apportionment 6.27 Cost Absorption 6.28 Responsibility Centre 7. Elements of Costs 7.1 Material Cost 7.2 Labour Cost 7.3 Expenses 7.4 Overheads 8. Classification of Costs 8.1 By Nature 8.2 By Behaviour 8.3 By Element 8.4 By Function 8.5 By Controllability 8.6 By Normality 8.7 By Time When Computed 9. Types / Techniques of Costing 9.1 Historical Costing 9.2 Uniform Costing 9.3 Standard Costing 9.4 Direct Costing 9.5 Marginal Costing 9.6 Absorption Costing 9.7 Difference Between Various Types of Costing 10. Methods of Costing 10.1 Job Costing 10.2 Batch Costing 10.3 Contract Costing 10.4 Process Costing 10.5 Operating Costing 10.6 Single Output or Unit Costing 10.7 Multiple Costing 11. Analysis of Last Questions 11.1 Scanning of Questions Asked in Past Examinations 11.2 Frequency Table Showing Distribution of Marks 1. COST ACCOUNTANCY The Institute of Cost and Management Accountants of England defines Cost Accountancy as follows: "The application of costing and cost accounting principles, methods and techniques to the science, art and practice of cost control and the ascertainment of profitability. It includes the presentation of information, derived therefrom for the purpose of managerial decision making." Thus cost accountancy is a very comprehensive term. 2. COST ACCOUNTING 2.1 Definition of Cost Accounting : Based on the terminology published by the Institute of Cost and Management Accountants of England , Cost Accounting is defined as the process of accounting for cost...
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This note was uploaded on 10/11/2010 for the course FINANCE 5101144 taught by Professor Hjk during the Spring '10 term at Arab Academy for Science, Technology & Maritime Transport.

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CA_Final_-_Cost_Accounting_Theory - CHAPTER 1 BASIC...

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