Financial statement= sales less cost

PRODUCT= t-shirt/damit

Overhead expenses= electric current, sinulid

Cost accounting uses double entry bookkeeping method (material, labor, overhead cost)

Benefits and can control cost

Costing methods=market value and follow standard procedure =body of systematic knowledge (science)

Skill to apply, require ability and skills, experience (art)

Financial accounting vs cost accounting

1. Provide data to internal users/ manegirial planning, controlling to help them plan control and
make decisions
2. Cost accounting can create many towhat they need. Prepared when needed
daily/weekly/monthly
3. Detailed information of cost and profits of each product, process, job order. No format in
presenting cost accounting info.
4. Mainly for management use only, no need to audit.

Manegirial expanded version of cost acct

Cost expanded version of financial acct

Manegiarial uses financial statements to make decision. To be usefull to the management. Reflect on
financial statement.

Cost acct. mechanical side of manegirial acct. to buy a plant or not manegirial makes reason for that
decision.

Cost accounting provide info to external thru financial statements

Uses of cost acct data

1. Determine selling price product=

2. Meeting competition= to know how to make lessen the value of price if new to business. Coast
acting makes that computations.
3. Bidding contract=
4. Analyzing profitability=benta less prouct price and pamasahe
 Planning and control
Planning=consist of long range plans
1. Strategic
2. Tactical= shorter range plan inside the long
3. Operation= day to day implementation of tactical= interaction, systems by department

Control= monitoring if objectives are being met in the planning process.

Cost systems

1. Job order= applicable in a unique product only to special, specific products. Different designs
Costing= labor, materials,
2. Process costing= continuous process of same, similar products.

Hybrid costing= combination of job order and process costing

[3-lesson]
 cost center is a means to
group your expenses in that department
Cost unit

Unit Production=manufacturing

Unit Service=

CLASSIFICATION

1. Based on Cost Behavior

 Fixed=more outputs
the lesser the cost per unit…divided by
Semi====Mixed Cost=the commissions or additional
2. Identifiability w/ Products

3. based on relation to product

4.
A.1.

A.2.

A.3.

A.3.1.
A.3.2.-A.3.3.
Raw Material Inventory
Work in Process Goods Inventory
Finished Inventory