Costing is same as cost accounting as it also includes the cost incurred in the production. Costing includes fixed, variable and manufacturing cost of the product. Costing is also known as absorption costing.

Service Department Costing

Service Department Costing: After studying this chapter you should be able to: Difference between service department and operating department: Most of the large organizations have both operating departments and service departments. The central purpose of the organization are carried out in the operating department.

Selecting Allocation Base

Selecting Allocation Base: Costs are ordinarily assigned to products and services by using a two stage process. In first stage, service department and other costs are allocated to operating departments. In second stage, the costs that have been assigned to operating departments are allocated

Target Costing Approach to Pricing

Learning Objective of the Article: Define and explain target costing. Compute the target cost for a new product or service. What are advantages and disadvantages of target costing approach. In traditional costing system it is presumed that a product has already been developed, has

Direct Materials Price Variance

Direct Materials Price Variance: Learning Objective of the articles: Define and explain “direct materials price variance” and its significance. How is it calculated? How direct materials price variance is interpreted? What are the reasons / causes of unfavorable or favorable materials price variance? Contents:

Direct Labor Standards

Direct Labor Standards: Learning Objective of the articles: Define and explain “direct labor standards” . How direct labor rate and direct labor efficiency standards are set? Direct labor price and quantity standards are usually expressed in terms of a labor rate and labor hours.
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