Definition: Direct cost, or otherwise called asprime costortraceable cost. It is the cost which can be directly allocated to the specific cost unit, cost centre or cost object, i.e. product, facility or project. On the basis of traceability, costs are classified into two types, wherein th...
As we’ve mentioned, job costing is a cost accounting method that’s used in virtually every industry that manages projects. Therefore, managers use job costing in a variety of disciplines. Let’s look at three of the more commonly used job-costing industries: project management, construction a...
Amanufacturer’smanagerial accountants and production managers try to categorize total expenses into direct and indirect costs, so they can see how much it is actually costing the company to produce certain products or run processes. Since direct costs can be directly attributed to something, it wou...
What is a business relief? What is fixed asset utilization? What is flexing in budgeting? What does cost-effective mean? What is a direct cost? What is price skimming in business? What is a fixed annuity? What is an NSF fee? What is a ?balance brought forward"?
What is Actual Costing? Costing accounting that uses actual cost, direct-cost rates and actual qualities used in production to determine the cost of specific products is called Actual Costing. With actual costing system, usually direct costs to a cost object or something that has a measurable cos...
What is revenue? What is total variable cost? What is an explicit cost? What is a sheriff's sale? What is a trust sale? What is a price point? What is a good sell through rate in business? What is price demand? What is a direct cost?
Indirect labor is a category of indirect cost and refers to those employees that assist the direct labor in the performance of their work. They are not involved directly in the service or production process. Since indirect labor cannot be traced back to a specific product or service, the relat...
The direct labor cost includes the wages and fringe benefits of the direct labor employees and the cost of the temporary staff that are working directly on the manufacturer’s products. The direct labor cost is classified as the following: A product cost (along with the costs of the direct ...
Cost controls can include budgetary controls, standard costing, andinventory management. Internal Costs Cost accounting can help with internal expenses such as the cost of transferring goods between a company's divisions and subsidiaries. For example, a parent company overseas might be the supplier for...
The alternative to the full costing method is known asvariableor direct costing. The treatment of fixed manufacturing overhead costs, such as salaries and building leases, isthe primary difference between these two different accounting styles. ...