Learn Financial and Managerial Accounting for Free
Treatment of Costs Under Activity Based Costing (ABC) System Learning Objectives: How manufacturing, non-manufacturing and idol capacity costs are treated under activity based costing system? Contents: Non-manufacturing costs and activity…
How a Bill of Exchange Functions: In order to fully grasp the transactions relating to bill of exchange we thoroughly learn the procedure. The following example will make it clear.…
Cost of Capital Definition: The overall cost to an organization of obtaining investment funds, including the cost of both debt sources and equity sources.
Cost of Acquiring Materials | Materials Acquisition Cost: A guiding principle in accounting for the cost of materials is that all costs incurred in entering a unit of materials into…
Ideal Standards Definition: Standards that allow for no machine breakdowns or other work interruptions and that require peak efficiency at all times.
Cost Object Definition: A cost object is anything for which cost data are desired. Examples of possible cost objects are products, product lines, customers, jobs, and organizational subunits such as…
Horizontal/Trend Analysis Definition: A side-by-side comparison of two or more years’ financial statements. Click here to read full article about horizontal or trend analysis. Relevant terms: Vertical Analysis
Hindrances/Problems to Proper Cost Assignment in Segmented Reporting: For segment reporting to accomplish its intended purposes, costs must be properly assigned to segments. If the purpose is to determine the…
Cost Driver Definition: Cost driver is a factor, such as machine-hours, beds occupied, computer time, or flight-hours, that causes overhead costs.
High-Low Point Method Definition: A method of separating a mixed cost into its fixed and variable elements by analyzing the change in cost between the high and low levels of…
Activity Based Costing System A Tool for Management to Aid Decision Making: Learning Objectives: Define and explain activity based costing (ABC) system. How various manufacturing and non-manufacturing costs are treated…
Half-Year Convention Definition: A requirement under the Modified Accelerated Cost Recovery System (MACRS) that allows a company to take only a half year’s depreciation in the first and last years…
Definition and Explanation of Horizontal or Trend Analysis: Comparison of two or more year’s financial data is known as horizontal analysis or trend analysis. Horizontal analysis is facilitated by showing…
Learning Objectives: Define and explain margin of safety. Calculate margin of safety ratio in Percentage. What is its significance/importance? Calculation of merging of safety in cost volume profit analysis Contents:…
Three Column Cash Book: Learning Objectives: Define and explain a three column cash book/treble column cash book. Prepare a three column cash book. What is the difference between a single…
Revenue Expenditures: Learning Objectives: Define and explain revenue expenditures. List of revenue expenditures. Definition and Explanation: Expenditures will be treated as revenue expenditures if it is incurred for the following…
Petty Cash Book: Learning Objectives: Define and explain petty cash book. What is the imprest system of petty cash? What are the advantages of Imprest system? Prepare a petty cash…
Activity Base Definition Activity base is a measure of whatever causes the incurrence of a variable cost. For example, the total cost of X-ray film in a hospital will increase…
Sidra Farid
Sana Ahmed
Abida Rehman
Shamsa Rafique
Robert