Documentos de Académico
Documentos de Profesional
Documentos de Cultura
THEIR USES
F A I S A L A R S YA (1706131654)
R I A N DY A R R A S Y I D (1706131875)
S I S PA N U R A D I A N A (1706131944)
COST
• Cost is a measurement
– in monetary terms, of the amount of resources used for some
purposes
• The notion that cost measures the use of resources
• Cost measurements are expressed in monetary terms
• Cost measurement always relates to a purpose
COST OBJECT
• Technical name for the product, project, organizational unit, or
other activity or purpose for which costs are measured
• Can be defined as broadly or as narrowly as one wishes
– Entire production run of jeans and one pair of jeans.
• In a service organization a variety of cost object definitions is
possible
– The hospital as a whole, the nursing staff, the X-ray department, the
emergency room, the personnel office, the cardiovascular ward,
treatment of a type of disease, care of an individual patient, or the
performance of a certain battery of blood tests
FULL COST
Full Cost
accumulates and
reports the costs of
Over-
product cost objects = head
Direct
product costing system cost
material
cost
Selling
cost
General &
administrative
*Or full production cost cost
DIRECT MATERIAL COST
• The sum of direct labor cost and overhead cost is conversion cost
– It includes all production costs needed to convert direct materials into
finished goods
• As factories become automated, the distinction between direct labor
and
• indirect labor becomes blurred. As a result, some companies no longer
distinguish between direct labor and overhead cost; instead, the single
category of conversion cost is used
FULL PRODUCTION COST
TARGET COSTING
• First set price based on competitive strategy, then product is designed
to cover full cost and profit.
USES OF FULL COST: PRODUCT PRICING (4)