Similarities Between Job-Order and Process Costing:
Both systems assign material, labor and overhead costs to
products and they provide a mechanism for computing unit
Both systems use the same manufacturing accoun
A Tool to Aid Decision Making
Activity Based Costing (ABC): An Overview
ABC is a costing method that is designed to provide managers
with cost information for strategic and other decisions that
potentially affect capacit
Service Department Allocations
In this section we will look at the allocation of service
department costs to operating departments.
Operating departments carry out the central purpose of
the organization. Examples of opera
This chapter focuses on the study of management control and
performance measures. It explains how standard costs are used by
managers to control costs.
Standard Costs Management by Exception:
A standard is a benchmark or norm for
Flexible Budgets and Overhead Analysis
This chapter expands the study of overhead variances that
was started in Chapter 10. It also explains how flexible budgets can
be used to control variable and fixed overhead costs.
Cost Behavior: Analysis and Use
This Chapter Focuses on:
1. A review of the definitions of variable costs and fixed
costs and discusses the behavior of these costs in greater
2. The analysis of mixed costs, and
3. Introducing the contribu
Process and Job-Order Costing:
Product costing is the assigning of costs to products and
services provided by a company.
Two costing systems are commonly used in
manufacturing and service companies:
1. Process costing system,
Cost Terms, Concepts and Classifications
General Cost Classifications:
Costs are associated with all types of organizations: manufacturing,
merchandising, and service.
Our focus in this chapter is on manufacturing companies which are