Bookkeeping Basics: What Is Cost Accounting?

Accountant, Accounting, Bookkeeping, Business Expenses, CPA, Deductions, expenses, Small Business, Taxes, Uncategorized

Cost accounting is a technique used to determine the best financial course of action. The primary purpose of cost accounting is to help decision-makers make decisions. By analyzing the cost of products, services, and projects, accountants can advise businesses of the best course of action regarding a particular transaction. To put it more simply, you calculate the elements of cost for product process (raw materials, labor, and expenses/overhead), compare that cost with the product price, determine the business’s revenue, and decide if and where savings are needed.

Cost accounting doesn’t have a singular approach. Cost accounting methods include: (more…)