Cost Accounting Flashcards
What is costs?
Cost is a sacrifice. It pertains to the resources given up to attain an objective
What are the two types of costs in expected economic benefit
Assets and Expense
If economic benefit is expected to pass across two period. It will benefit the company a long time.
Assets
Unexpired Costs - bumili ng supplies.
This is current and future
Cost is already expired.
Expired Cost. Current only
How cost will change in relation to activity/driver
- Activity - economic transaction
- exchange of resources
- incurred cost - Cost Driver - factor that influences the movement.
- ex. labor cost - paid based on the labor hours
- it affects the level of costs - Cost - different type of costs
What are the cost classifications
Variable Cost, Mixed Cost, Step Cost, Unit fiz
What is the X axis
Volume. Level of Activity. Independent variable
What is the Y axis
Total Costs. Dependent Variable
Variable Cost
Direct, cost increase, volume increase. Changes in volume
Total Fixed Cost and Unit Variable Cost
parallel to x axis. constant
Starts a point of origin. It doesn’t automatically mean it will start at 0.
Total Mixed Cost (Variable Cost and Fixed Cost
Unit Fixed Cost
Asymptotic. - Shows a hyperbola. Hanggang friends lang. It approaches the value of x but it will not meet.
From upper left to down right. This is inverse
Changes in relevant range
Step Cost. In total variable cost, this focuses on changes in volume. This is semi variable cost
If malaki ang laktaw on changes in relevant range
Semi-fixed.
Most used assumption in cost accounting
Relevant Range
- usually based on capacity, linear and valid relationships
