Cost Accounting

The study of how to accurately measure and allocate costs within a company, including understanding cost behaviors and creating cost models.

How does the Institute of Management Accountants define cost accounting?

Quote: "Cost accounting is defined by the Institute of Management Accountants as 'a systematic set of procedures for recording and reporting measurements of the cost of manufacturing goods and performing services in the aggregate and in detail.'"

What does cost accounting aim to advise management on?

Quote: "Its end goal is to advise the management on how to optimize business practices and processes based on cost efficiency and capability."

What does cost accounting provide to management?

Quote: "Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future."

How is cost accounting related to managerial accounting?

Quote: "Often considered a subset of managerial accounting..."

What are the methods included in cost accounting?

Quote: "It includes methods for recognizing, classifying, allocating, aggregating and reporting such costs and comparing them with standard costs."

What is the role of cost accounting in financial accounting?

Quote: "Cost accounting information is also commonly used in financial accounting..."

What is the purpose of recording and reporting measurements of costs in detail?

Quote: "A systematic set of procedures for recording and reporting measurements of the cost of manufacturing goods and performing services in the aggregate and in detail."

How does cost accounting assist in decision-making?

Quote: "Cost accounting information is for use by managers to facilitate their decision-making."

What does cost accounting help management control?

Quote: "Cost accounting provides the detailed cost information that management needs to control current operations..."

How does cost accounting contribute to planning?

Quote: "...and plan for the future."

What is the primary function of cost accounting?

Quote: "Its primary function is for use by managers to facilitate their decision-making."

What is the purpose of comparing costs with standard costs?

Quote: "...comparing them with standard costs."

What actions does cost accounting aim to optimize?

Quote: "...optimize business practices and processes based on cost efficiency and capability."

What is the role of cost accounting in optimizing business practices?

Quote: "Its end goal is to advise the management on how to optimize business practices and processes..."

How does cost accounting assist managers?

Quote: "Cost accounting provides the detailed cost information that management needs..."

What type of costs does cost accounting focus on?

Quote: "...measurements of the cost of manufacturing goods and performing services..."

What types of costs are aggregated and reported?

Quote: "...methods for recognizing, classifying, allocating, aggregating and reporting such costs..."

How does cost accounting contribute to financial accounting?

Quote: "Cost accounting information is also commonly used in financial accounting..."

What is the systematic set of procedures in cost accounting for?

Quote: "A systematic set of procedures for recording and reporting measurements..."

What information does cost accounting present to management?

Quote: "Cost accounting provides the detailed cost information that management needs..."