➢ Cannot be conveniently or economically traced (tracked) to a cost object. Instead of being traced, these costs are allocated to a cost object in a rational and systematic manner
different purposes Describe a framework for cost accounting and cost management
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Learning objective 1 Define and illustrate a cost object
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companies, and service-sector companies Describe the three categories of inventories commonly found in
manufacturing companies Distinguish inventoriable costs from period costs Explain why product costs are computed in different ways for
Following accumulation, costs are assigned to the chosen cost object. involves tracing and allocating costs
✓ Tracing：accumulated costs with a direct relationship to the cost object
Activity Department
Illustration BMW X 5 sports activity vehicle Dealer-support telephone hotline R&D project on DVD system enhancement Herb Chambers Motors, a dealer that purchases a broad range of BMW vehicles
✓ Allocating：accumulated costs with an indirect relationship to the cost object
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Learning objective 2 Distinguish between direct costs and indirect costs
Setting up production machines Environmental, Health & Safety
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Cost And Cost Terminology
Cost Accumulation
Cost Assignment via
Cost Object

Cost Object
成本与管理会计亨格瑞第13 版英文版CA02
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LEARNING OBJECTIVES
Define and illustrate a cost object Distinguish between direct costs and indirect costs Explain variable costs and fixed costs Interpret unit costs cautiously Distinguish among manufacturing companies, merchandising
Ⅰ Basic Cost Terminology
Cost
➢ Sacrificed resource to achieve a specific objective ➢ It is usually measured as the monetary amount that must
be paid to acquire goods and services.
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Ⅰ Basic Cost Terminology
Actual Cost
➢ A cost that has occurred, (a historical cost)
Budgeted Cost
➢ A predicted cost
Opportunity Cost
➢ The next best choice foregone.
Cost Object
Tracing
Allocating
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BASIC COST TERMINOLOGY,CONTS.
Cost Accumulation describes the process of accumulating costs in some organized manner through the accounting system.
2-5Cost Object
➢ Anything for which a separate measurement of costs is desired
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Cost Object Examples at BMW
Cost Object Product Service Project
Customer
Includes: ➢Parts ➢Assembly line wages
Cost-Tracing describes the assignment of direct costs to the particular cost object.
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Indirect Costs
Indirect Costs
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Ⅱ Direct Costs and Indirect Costs
Direct costs of a cost object are those that are related to a given cost object (product, department, etc.) and that can be traced to it in an economically feasible way.