Bank Theory

Costing Methods - Bank Theory Costing Methods 1. Unit and Output Costing Used in industries producing a single product in mass. Example: Brick, cement, and oil industries. Cost per unit = Total cost / Number of units produced 2. Job Costing Costing for specific jobs with unique specifications. Each job is separately identifiable. Job Cost Card includes direct materials, labor, and overheads. 3. Batch Costing Used when similar items are produced in batches. Example: Pharmaceuticals, toys. Cost per unit = Total batch cost / Number of units in batch 4. Contract Costing Used for long-term construction contracts. Example: Road, bridge construction. Progress Payments: Made during contract progress. Retention Money: Portion withheld until contract completion. Escalation Clause: Compensates for price fluctuations in materials/labor. 5. Process Costing Used where products go through continuous proces...

An Overview of Cost & Management Accounting An Overview of Cost & Management Accounting 1. Introduction to Cost Accounting Cost Accounting is the process of recording, classifying, analyzing, summarizing and allocating costs associated with a process, and then developing various courses of action to control the costs. It helps businesses determine the actual cost of production or service. Evolution: Cost Accounting emerged during the industrial revolution when manufacturing became more complex. The focus was to determine accurate production costs to set competitive selling prices. Objectives: Ascertain cost of product/service Cost control and cost reduction Assist in decision-making Scope: It includes cost computation, cost reduction, budgeting, and performance evaluation of cost centers. 2. Concepts and Classification of Cost Direct Cost: Directly attributable to a product (e.g., raw material) ...