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Increasing transparency regarding material and energy flows and the respective costs; Supporting organizational decisions in areas such as process engineering, production planning, quality control, product design and supply chain management; Improving coordination and communication on material and energy use within organizations.
An important part of standard cost accounting is a variance analysis, which breaks down the variation between actual cost and standard costs into various components (volume variation, material cost variation, labor cost variation, etc.) so managers can understand why costs were different from what was planned and take appropriate action to ...
It is the application of economic theory and methodology in business management practice. Focus on business efficiency. Defined as "combining economic theory with business practice to facilitate management's decision-making and forward-looking planning." Includes the use of an economic mindset to analyze business situations.
In business economics cost breakdown analysis is a method of cost analysis, which itemizes the cost of a certain product or service into its various components, the so-called cost drivers. The cost breakdown analysis is a popular cost reduction strategy and a viable opportunity for businesses.
Multiple choice questions lend themselves to the development of objective assessment items, but without author training, questions can be subjective in nature. Because this style of test does not require a teacher to interpret answers, test-takers are graded purely on their selections, creating a lower likelihood of teacher bias in the results ...
A costing method that includes all manufacturing costs—direct materials, direct labour, and both overhead—in unit product costs. According to the ICMA London "Absorption costing is a principle whereby fixed as well as variable costs are allocated to cost unit the term may be applied where production costs only or costs of all function are ...
Job Costing is the process of determining the labor and materials cost for each job in a systematic way, and then using this information to create a quote for the customer. Job costing or cost accounting can be used in virtually any industry (especially service industry) to ensure that the product pricing covers actual costs, overhead and ...
A cost centre is a department within a business to which costs can be allocated. The term includes departments which do not produce directly but they incur costs to the business, [1] when the manager and employees of the cost centre are not accountable for the profitability and investment decisions of the business but they are responsible for some of its costs.