CMAGlossary1 Flashcards
ABC Overhead Costing Method
A method that assigns overhead using multiple cost pools and multiple cost drivers (volume- and/or activity-based).
Abnormal Spoilage
Unacceptable units that are not expected to occur under an efficient production process. [CMA]
Absorbed Overhead
That portion of factory indirect cost that has been allocated to a specific product, or saleable service. (Also called Applied Overhead.) [CMA]
Absorption Costing
A costing system that assigns to inventory all types of manufacturing costs, including direct, indirect, fixed and variable. (Also called Full Absorption Costing.) [CMA]
Accelerated Depreciation
A pattern of depreciation in which the amount of depreciation computed in the early years is greater than the amounts computed in the later years. [CMA]
Accounting
The process of identifying, classifying, measuring, recording and communicating in monetary terms transactions and events of an economic entity that are of a financial character. [CMA]
Accounting Profit
Revenue less all expenses included in the entity’s income statement. [CMA]
Accounting Standards
Principles and procedures to be followed by accountants as formulated by an authoritative body. (Also called Accounting Principles.) [CMA]
Accounting System
Methods, procedures, and standards followed in accumulating, classifying, recording and reporting business events and transactions. [CMA]
Accounts Payable
Monies that are due to a vendor (supplier) for merchandise or services rendered. [CMA]
Accounts Payable Turnover
A financial ratio used to measure the rate at which an entity pays off its suppliers. [CMA]
Accounts Receivable
Monies due to an entity from customers who have bought merchandise or received services on account. [CMA]
Accounts Receivable Turnover
A financial ratio used to measure asset utilization and a company’s ability to collect cash from credit sales to its customers. [CMA]
Accrual Accounting
The method of recognizing and recording (a) revenues when earned, and (b) expenses when incurred, both irrespective of the time when cash is received or paid. [CMA]
Accrued
The accumulation of income that is due but has not been received or a cost that is incurred but has not been paid by an entity during the accounting period. [CMA]
Accumulated Depreciation
The amount of depreciation expense related to a fixed asset that has been recognized as an expense from the date of acquisition of that asset. [CMA]
Acid-Test Ratio
A ratio that measures an entity’s ability to pay off short-term obligations using the most liquid current assets (excluding inventory). (Also called Quick Ratio.) [CMA]
Acquisition Cost
The value of cash or other resources given up in exchange for goods or services. It includes all costs necessary to get the asset ready for its intended use. (Also called Historical Cost or Original Cost.) [CMA]
Activity
A repetitive action (event, task, unit of work) with a specified business purpose.
Activity Analysis
The process of detailing the activities in making a product or providing a service, classifying them as value-added or non-value-added, and finding ways to minimize or eliminate the non-value added actions.
Activity Cost Driver
A measure of the amount of activity used by a cost object.
Activity Driver
A measure of the amount of activity used by a cost object.
Activity Driver (Cost Driver )
A factor used to assign cost from an activity to a cost object. A measure of the frequency and intensity of use of an activity by a cost object. [CMA]
Activity-Based Budgeting
An approach to budgeting that involves quantifying activities and processes and forecasting their costs in order to achieve strategic goals and improve performance. [CMA]
Activity-Based Costing (ABC)
A costing system that (a) identifies the relationship between the incurrence of cost and activities, (b) determines the underlying “driver” of the activities, (c) establishes cost pools related to individual “drivers,” (d) develops costing rates, and (e) applies cost to product on the basis of resources consumed (drivers). [CMA]
Activity-Based Management
Management and decision making method using activity based costing information in an effort to improve customer satisfaction and profits by enhancing activities that add value and reducing activities that do not add value to the customer. [CMA]
Actual Cost (See: Actual Cost System)
Acquisition cost, historical cost, or original cost. [CMA]
Actual Cost System (See: Actual Cost)
A costing system that records actual costs.
Additional Paid-in Capital
The amount received by a company from its shareholders for purchase of shares of stock above the par or stated value of the stock. [CMA]
Administrative Expense
Costs incurred for the general operation of an enterprise as a whole, as contrasted with costs related to a more specific function such as manufacturing or selling. (Also called General and Administrative Expense.) [CMA]
Allocate
Identification of costs with cost objectives; apportioning or distributing costs to products, processes, jobs, or departments. [CMA]
Allocation Base
The basis used to assign indirect costs to cost objects, such as labor or machine hours. [CMA]
Allowance for Uncollectible Accounts
A contra account to Accounts Receivable established to record the estimated percentage of Accounts Receivable that will not be collected. [CMA]
Amortization
The accounting process of allocating costs to the time periods during which such costs are consumed. [CMA]
Annual Report
A report prepared by entities after the close of each reporting year that includes financial statements and disclosure, an audit report, information from management, and other pertinent information concerning the entity’s financial condition and operating performance. [CMA]
Annuity
A series of payments of an equal amount at fixed intervals for a specified number of periods. [CMA]
Application Controls
Controls, such as input controls, adopted to safeguard specific data processing activity, such as payroll. Their purpose is to provide reasonable assurance that data is properly processed, recorded, and reported. [CMA]
Appraisal Costs
Costs incurred to determine whether products and services are conforming to customer and/or manufacturing requirements. Examples include inspection and testing costs. [CMA]
Appreciation
The situation where there is an increase in economic worth caused by rising market prices. [CMA]
Arbitrage Pricing Theory (APT)
A framework for analyzing the relationship between risks and rates of return on securities, especially common stocks. It asserts that the risk elements that influence returns on securities include (1) inflation, (2) industrial production, (3) risk premiums, and (4) the slope of the term structure of interest rates.
Asset
- Probable future economic benefits obtained by an entity as a result of past transactions. 2. Any owned physical object or right having economic value to its owners, expressed for accounting purposes in terms of its cost or other value (such as current replacement cost). [CMA]
Asset Coverage
A measure of the extent to which a company is able to cover its debt obligations after all liabilities have been satisfied.
Asset Turnover
A financial ratio that assesses how efficiently an entity is utilizing its assets; it relates sales to assets. (Also called Total Asset Turnover.) [CMA]
Audit
The systematic examination by analyses, confirmation, and tests of accounting records to confirm with reasonable assurance that the records adequately reflect economic status and operations. [CMA]
Audit Committee
Members of the board of directors (in the case of corporations), trustees, legislative bodies, or similar governance boards, with responsibilities for oversight and direction of the internal auditing function. [CMA]
Audit Report
A written document that presents the scope and results of the audit. [CMA]
Auditing Standard #5
PCAOB standard making Section 404 audits and management evaluations more risk-based and scalable to company size and complexity.
Authoritative (top-down) Budgeting
A budgeting process where all budgets for the organization are prepared by top management, including budgets for lower-level operations. [CMA]
Authoritative Standard
Budget standard that is determined by the management of the company.
Authority
The formal and legitimate right of a manager to make decisions, issue orders, and allocate resources to achieve organizationally desired outcomes. [CMA]
Autocorrelation
A relationship between two variables that is inherently non-linear.
Average Collection Period
A measure of the average number of days it takes to collect receivables (credit sales). (Also called Days Sales Outstanding and Days Sales in Receivables.) [CMA]
Average Fixed Cost
Total fixed costs divided by the number of units produced. (Fixed cost per unit) [CMA]
Average Total Cost
Total manufacturing costs divided by the number of units produced. Sometimes called per unit cost. [CMA]
Average Variable Cost
Total variable cost divided by the number of units produced. [CMA]
Backflush Costing
A product costing approach used in a Just-in-Time operating environment in which some or all of the costing is delayed until the goods are finished. Standard costs are then pulled backward through the system to assign costs to products. [CMA]
Backup Controls
Controls, such as file duplicating, in an Information Technology (IT) environment to insure that data is not lost. [CMA]
Bad Debts
Accounts or notes receivable that management determines to be uncollectible after reasonable efforts to collect them have not been successful. [CMA]
Balance Sheet
A financial statement that summarizes a company’s assets, liabilities and shareholders’ equity at a particular point in time. [CMA]
Balanced Scorecard
An approach using multiple measures to evaluate performance, including financial measures, and the non-financial measures of customers, internal business processes, and learning and growth. [CMA]
Balanced scorecard
A management tool to evaluate performance which includes both financial measures and non-financial measures (customers, internal business processes, and learning and growth).
Banker’s Acceptances
Financial instrument of an entity stating that payment is guaranteed by a bank, commonly used in foreign trade. [CMA]
Bankruptcy
A condition in which a court has granted a company legal protection from creditors because it cannot meet its obligations as they come due. [CMA]
Batch Costing
The costs of activities related to a group of units of products or services rather than to each individual unit of product or service. [CMA]
Batch Processing
The processing in which data is gathered over a period of time and aggregated (batched) for subsequent sequential processing.
Benchmarking
A process of measuring an entity’s performance, products, and services against standards based on best levels of performance achievable or achieved by other entities. [CMA]
Best Practice
A technique, method, process, or activity that is more effective at delivering a particular outcome than any other technique, method, process, or activity. [CMA]
Best Practice Analysis
Analysis of the way leading-edge organizations deliver world-class standards of performance in areas such as cost, quality, and timeliness.
Beta
A measurement of the movement of the price of a particular stock compared with the movement of the market as a whole during the same period. If a stock has a beta value less than 1, it is regarded as less risky than the overall market. If a stock has a beta value greater than 1, it is regarded as more risky than the market. [CMA]
Binomial Option-Valuation Models
Option pricing models in which the underlying asset can take on only two possible, discrete values in the next time period for each value that it can take on in the preceding time period. [CMA]
Black-Scholes Option-Valuation Model
A model for pricing options in which the value of an option depends on (1) the value of the underlying asset, (2) the time to expiration of the option, (3) the exercise price, (4) the volatility of the underlying asset, and (5) the risk-free rate or time value of money. [CMA]
Board of Directors
A group of individuals elected by a corporation’s shareholders to oversee the management of the corporation. The members of a Board of Directors meet periodically and assume legal responsibility for corporate activities. [CMA]
Bond
A long-term debt instrument signifying the promise of the issuer to pay the face amount at the maturity date. Periodic interest payments are often required. [CMA]
Bonds Payable
A long-term liability account used to record the amount of bonds that are outstanding. [CMA]
Book Value
The amount at which an asset or a liability is carried on the books of account, net of any contra account. (Also called Net Book Value.) [CMA]
Book Value per Share
Measures common shareholder equity on a per share basis. [CMA]
Bottleneck
Operational constraints or inefficient usage of available resources creating work-in-process inventory buildup and/or idle time. [CMA]
Bottom-Up Approach
An approach to auditing internal controls whereby all controls are documented irrespective of risk. [CMA]
Breakeven Analysis
An analysis of the relationship of cost and revenue. It determines the volume at which there is neither profit nor loss for a product or group of products. (Also called Cost/Volume/Profit Analysis.) [CMA]
Breakeven Point
The volume of sales at which total revenues and total costs are equal. [CMA]
Budget
A schedule of planned or expected revenues, expenses, assets, and liabilities. A budget provides guidelines for future operations and appraisal of performance. (Also called Profit Plan.) [CMA]
Budget Committee
A group of senior managers tasked with budget oversight.
Budget Cycle
The period of time between one budget and the next.
Budget Planning Calendar
A schedule of activities for the development and adoption of the budget.
Budget Process
The process used by an organization to prepare a plan for a future period, allocate resources, determine revenues and expenditures, and compile reports pertaining to that plan. [CMA]
Budgetary Slack
Intentional underestimation of revenues and/or overestimation of expenses. [CMA]
Budgeting
The process of planning flows of financial resources into, within, and from an entity during a specified future period or for a specified project. [CMA]
Business
A commercial or industrial enterprise. [CMA]
Business Combination
A grouping of a company with other businesses into a single accounting entity for reporting purposes (consolidated financial statements). The company and the other businesses continue to operate as separate entities. [CMA]
Business Plan
A document prepared by a company’s management, detailing the past, present, and future of the company. It forms the basis for preparing budgets for the individual company units. [CMA]
Business Portfolio
A collection of products, projects, services, or brands that are offered for sale by an entity. [CMA]
Business Process
A sequence of logically related and time based work activities to provide a specific output for a customer. [CMA]
Business Process Reengineering (BPR)
A technique for radically and fundamentally altering the way a business operates to achieve improvements in cost, quality, service, and speed.
Business Unit
Any segment of an organization, or an entire business entity that is not divided into segments. Sometimes treated as a Profit Center. [CMA]
Byproduct
An item resulting from a production process that has relatively little value compared to the company’s main product. [CMA]
Call Option
A contract that gives the buyer the right to buy an asset (for example a share of stock) at a specified price within a specified period of time. [CMA]
Call-Back Procedure
One type of control in which the host computer redials or reconnects with remote users at previously authorized connections.
Capacity Constraints
Resources that limit the maximum performance possible considering the conditions of the existing physical plant, labor force, method of production, or supply of material. [CMA]
Capacity Management
Management of an entity’s costs of unused (excess) capacity such as production facilities, distribution channels, etc. [CMA]
Capital
- The equity invested in an entity by its owners. Total assets less liabilities. 2. Long-term assets (e.g., equipment). [CMA]
Capital Adequacy
The amount of capital relative to a company’s assets. A useful measure in risk management (particularly for banks). [CMA]
Capital Asset Pricing Model (CAPM)
A general framework for analyzing the relationship between risks and rates of return on securities, especially common stocks. [CMA]
Capital Budget
A plan of proposed outlays for acquiring long term assets and the means of financing the acquisition. [CMA]
Capital Budgeting
The evaluation and making of long-term investment decisions. [CMA]
Capital Gain or Loss
The extent by which the net realized value from sales of a capital asset exceeds (or in the case of a capital loss is less than) the cost of acquisition plus additional improvements, less depreciation and/or depletion charges. [CMA]
Capital Investment
Any expenditure which increases the capacity, efficiency, life span, or economy of the operation of an existing fixed asset. Outlay of money from which future cash inflows are expected for more than a year. (Also referred to as Capital Expenditure.) [CMA]
Capital Lease
A lease that transfers substantially all the benefits and risks inherent in the ownership of the property to the lessee, who accounts for the lease as an acquisition of an asset and the incurrence of a liability. [CMA]
Capital Rationing
A situation that exists when a constraint is placed on the total amount of the entity’s capital investment funds. The limited investment funds available must be allocated to the highest priority projects. [CMA]
Capital Stock
Ownership shares in a corporation issued to shareholders. May consist of Common Stock and Preferred Stock. [CMA]
Capital Structure
The relative proportions of short-term debt, long-term debt, and owners’ equity in the company. [CMA]
Capitalize
To record expenditure that is expected to benefit a future period as an asset rather than treating the expenditure as an expense of the period in which it occurs. [CMA]
Carrying Cost
Costs of storing and holding inventory, including the cost of capital from the time of acquisition or manufacture until the time of sale or use. [CMA]
Cartel
An organization of sellers coordinating supply decisions to maximize joint profits. A cartel seeks to create a monopoly in the market. [CMA]
Cash
Refers to money in the form of liquid currency that a bank will accept for immediate deposit, such as coins, checks, and money orders. [CMA]
Cash Budget
An estimate of the amount and timing of cash receipts and disbursements at various points over a future period, and cash on hand at the end. [CMA]
Cash Cycle
The period of time during which cash is converted into inventories, and inventories are converted back into cash through the sale of goods or collection of accounts receivable. (Also called Cash Conversion Cycle or Earnings Cycle.) [CMA]
Cash Discount
A reduction in the basic price, commonly used to encourage prompt payment or promote sales. [CMA]
Cash Equivalents
Short-term financial instruments of high liquidity and safety which can be converted to cash on short notice [CMA]
Cash Flow
The stream of cash inflows and outflows of an entity or segment of an entity. [CMA]
Cash Flow at Risk
A probabilistic estimate of the sensitivity of cash flow; how budgeted cash flow might be affected by changes in certain risk factors and other variables. [CMA]
Cash Flow Ratio
A liquidity measure, whereby operating cash flow is divided by current liabilities. [CMA]
Cash Flow to Fixed Charges
A leverage ratio that measures the cash flow available to meet fixed charges. [CMA]
Cash Management
The processes an entity uses to collect, disburse, and invest its cash. [CMA]
Cash Ratio
A measure of a company’s liquidity that relates cash and marketable securities to current liabilities. [CMA]
Centralization
An organizational structure in which senior management maintains significant direction, authority, and control over all operations and policies. [CMA]
Certainty Equivalent
The amount a recipient would require with certainty to be indifferent between this certain risk-free amount and a particular uncertain risky amount. [CMA]
Change in the Quantity Demanded
A change in the quantity that buyers are willing to purchase at different price levels due only to a change in price. Often referred to as a movement along the demand curve. [CMA]
Change in the Quantity Supplied
A change in the quantity sellers are willing to supply due only to a change in price. Often referred to as a movement along the supply curve. [CMA]
Check Digit
A redundant digit added to a computer code to check accuracy of other characters in the code.
Chief Audit Executive (CAE)
Top position within the organization responsible for internal audit activities.
Code of Conduct
A set of rules outlining acceptable ethical behavior for employees within an organization. [CMA]
Coefficient of Variation
A statistical measure of relative dispersion or relative risk. It is computed by dividing the standard deviation by the expected value. [CMA]
Collateral
An asset pledged as a guarantee to a lender until a loan is repaid. If the borrower defaults, the lender has a right to sell the collateral asset. [CMA]
Commercial Bank
An institution that accepts deposits, offers checking accounts, makes loans, and offers a variety of other related services. [CMA]
Commercial Paper
A short-term unsecured loan of a corporation having maturity up to 270 days. It is typically issued on a discount (from face value) basis. [CMA]
Commitment Fee
A fee paid to a financial institution by an entity to secure a line of credit and maintain the unused portion thereof. [CMA]
Committed Costs
Costs that are fixed (administrative salaries, rent, etc.) and generally are not controllable.
Committee of Sponsoring Organizations (COSO)
A voluntary private-sector organization, established in the U.S., dedicated to providing guidance on organizational governance, business ethics, internal control, enterprise risk management, fraud, and financial reporting. [CMA]
Common Base Year Statements
Financial Statements showing the percentage change over a base year. (Also called Horizontal Analysis.) [CMA]
Common Cost
A cost of operating a facility that is shared by two or more users. [CMA]
Common Stock
An ownership share in a company, having voting and dividend rights. [CMA]
Common-Size Financial Statements
Financial statements used for comparison between firms. A common size Income Statement shows all amounts as a percent of revenue. A common size Balance Sheet shows all values as a percent of total assets. [CMA]
Company Risk
The risk due to the unique circumstances of a specific enterprise, as opposed to the overall market. (Also called Unsystematic Risk.) [CMA]
Comparability
The quality of information that enables users to identify similarities in and differences between two sets of economic phenomena. [CMA]
Compensating Balance
An amount required to be kept on deposit at a bank. [CMA]
Compensation
Employee or management wages and other financial benefits earned from labor. [CMA]
Competence
An ethical standard in IMA’s Statement of Ethical Professional Practice that requires members to maintain an appropriate level of professional expertise and perform duties in accordance with relevant laws and standards. [CMA]
Competition-Based Pricing
A pricing strategy wherein the price of a product is determined primarily by the price being charged by one or more competitors. [CMA]
Completed-Contract Method
An accounting method that defers recognition of revenues until the completion of a contract, but recognizes anticipated losses immediately. [CMA]
Compliance
An organization’s adherence to laws, rules, policies, and procedures.
Compliance Audit
A type of internal audit that reviews an organization’s adherence to laws, rules, policies, and procedures. [CMA]
Compliance Risk
Risk to earnings or capital arising from violations of laws, rules, regulations, policies, procedures, and/or ethical standards. [CMA]
Compound Interest
Interest resulting from the periodic addition of simple interest to principal, establishing the new base as the principal for computation of interest for the next period. [CMA]
Comprehensive Income
All changes in equity during a period except those resulting from investments by owners and distributions to owners. [CMA]
Computer-Assisted Audit Techniques (CAAT)
The use of computers to automate or simplify the audit process in testing, fraud detection, and the analysis of large volumes of data.
Concentration Banking
A procedure utilized to manage cash wherein an entity utilizes a large bank (the Concentration Bank) to gather all the cash from smaller local (depository) banks where customers make payments. [CMA]
Confidentiality
An ethical standard in IMA’s Statement of Ethical Professional Practice that requires members to keep employer information confidential and to not use confidential information for personal advantage. [CMA]
Conservatism
- An accounting concept that states that revenues are recognized only when they are reasonably certain, but expenses are recognized when they are probable. 2. A prudent reaction to uncertainty to try to ensure that uncertainty and risks inherent in business situations are adequately considered. [CMA]
Consistency
Conformity from period to period with unchanging policies and procedures. [CMA]
Consolidated Financial Statements
Financial Statements showing financial condition or operating results of two or more associated enterprises as they would appear if they were one entity. [CMA]
Constant Gross Profit Method
A method of allocating joint costs where costs are allocated so that the overall gross-margin percentage is identical for each individual product. (Also called Gross Margin Method.) [CMA]
Constraint
An activity, resource, or policy that limits or bounds the attainment of an objective. [CMA]
Constraints Analysis
An evaluation of constraints in a manufacturing process.
Contingency Planning
Planning for the response to situations that may occur such as emergencies or setbacks [CMA]
Continuous
Not dividable into distinct units.
Continuous Budget
A moving projection of financial operations for a series of weeks, months, or quarters immediately ahead. At the end of each period, the portion of the projection then lapsed is removed and a new projection for a period of similar length is added to the series. (Also called Rolling Budget.) [CMA]
Continuous Improvement
A management approach to productivity improvement, where planned improvements occur in small incremental amounts by refinement of all components of a process. (Also called Kaizen.) [CMA]
Contribution Margin
The excess of sales revenues over variable costs. (Also called Marginal Contribution or Marginal Income.) [CMA]
Contribution Pricing
A method of establishing the price of the product based on variable costs and usually a profit margin. [CMA]
Control
Assuring that desired budgeted results are achieved through checks and balances on managers, including the use of performance evaluations tied to the budget.
Control Activities
Under COSO Framework, a component of internal control that includes the policies, procedures, and practices that ensure management objectives are achieved and risk mitigation strategies are executed.
Control Environment
Under COSO Framework, a component of internal control that establishes the foundation for the internal control system by providing fundamental discipline and structure.
Control Risk
A measure of the auditor’s assessment of the likelihood that misstatements exceeding a tolerable level will not be prevented or detected by the client’s internal control system. [CMA]
Controllable Cost
A cost that can be influenced by the actions of the responsible manager. [CMA]
Controller
The individual within an entity who is responsible for the accounting function. (Also called Comptroller.) [CMA]
Controls
Measures put in place to monitor activities and ensure they are functioning as designed. [CMA]
Conversion Cost
The sum of all manufacturing costs except direct material. [CMA]
Convertible
Securities (bonds or preferred stock) issued by companies which can be converted into common shares at a given price at a future date. [CMA]
Corporate Culture
The behavioral climate in an organization.
Corporate Governance
The set of rules, processes, policies and/or laws by which an organization is directed, operated and controlled. [CMA]
Corporate Social Responsibility (CSR)
When a company considers the ethical, legal, economic, environmental and philanthropic impact on stakeholders of the way it does business and tries to act in a responsible manner.
Corrective Controls
Controls designed to correct errors or irregularities that have been detected.
Correlation
The extent or degree of statistical association among two or more variables. [CMA]
Cost (noun)
- In management accounting, a measurement in monetary terms, of the amount of resources used for some purpose. 2. In financial accounting, the sacrifice measured by the price paid or required to be paid, to acquire goods or services. [CMA]
Cost (verb)
To ascertain the cost of something. [CMA]
Cost Allocation System
A method by which costs are allocated to cost objects (Job order costing, Process costing, Activity-based costing, and Life-cycle costing). [CMA]
Cost Behavior
The change or lack of change in the amount of a cost item associated with changes in the level of activity. [CMA]
Cost Benefit Analysis
A tool for planning and reporting that involves the identification and measurement of all costs and benefits attributed to an activity. [CMA]
Cost Center
A grouping of operating costs having some common characteristics for measuring performance and assigning responsibility. A Responsibility Center where the manager is responsible for costs only. [CMA]
Cost Change Control System
An element of the cost management plan in which the cost baseline are outlined.
Cost Driver
A variable causally affecting costs over a time period. [CMA]
Cost Management
Actions undertaken by managers to satisfy customers while continuously controlling and reducing costs. [CMA]
Cost Objects
A function, organizational subdivision, contract, or other work unit for which cost data are desired and for which provision is made to accumulate and measure the cost of processes, products, jobs, capitalized projects, etc. [CMA]
Cost of Capital
A measure of the cost of using capital. A weighted average of the interest cost of debt capital and the implicit cost of equity capital. It is the minimum rate of return that must be earned on new investments that will not dilute the interests of the shareholders. [CMA]
Cost of Goods Sold
The inventory costs of the goods sold during a specific time period; the difference between the costs of goods available for sale during a specific period of time and the cost of goods on hand at the end of the period. Inventory costs include all costs necessary to get the product ready for sale. [CMA]
Cost of Quality
Costs incurred to detect, prevent, or rectify poor quality production. [CMA]
Cost of Sales
The cost of products or services whose sales are reported as revenue. (Also called Cost of Goods Sold.) [CMA]
Cost Pools
The collection of cost elements that have a common cause and that can be assigned to other cost objects according to a common basis of allocation. [CMA]
Cost Standards
Cost standards that are based on the quantity of the resources that should be used and what should be the cost for each unit of those resources.
Cost System
The system an entity utilizes to collect and assign costs to intermediate and final cost objects. [CMA]
