Talk:Cost accounting
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[edit] Proposed merge with Management Accounting
Disagree. Cost accounting is only part of management accounting and, in my opinion, it is too large a subject to be covered adequeately in a manageable article on management accounting. —Theo (Talk) 13:11, 22 July 2005 (UTC)
Disagree. Cost accounting is a specific subject that is well known and one that individuals may want to research particularly. Management accounting covers many areas, and generally evolves more as new methods of tracking and accounting are developed. Finally Cost Accounting has specific uses for goverment and contractor type work which separates it from management accounting which is generally geared primarily towards internal users of financial statements. See CASB for complete details on legislative involvement in this area. —Augustz 18:41, 2 August 2005 (UTC)
Disagree. Although educators often teach cost accounting and management accounting as a single academic subject (e.g., there are many textbooks entitled "Management and Cost Accounting") in practice there is a clear distinction between these branches of accounting. In practice there is a clear distinction between Financial Accounting (for external users) and Management Accounting (for managerial users), and Cost Accounting is an overlap between these two. For example nearly all firms use some form of absorption costing (which is a basic cost accounting technique) for financial accounting purposes, but many firms use activity-based costing (a different cost accounting technique) for management accounting purposes.
Disagree. It is much easier to find the information you want if you can look up specific things as opposed to having to sift through an article for the things you want.
Disagree Cost Accounting and Management Accounting are taught as seperate course at many universities.
Disagree. Totally stupid to merge Cost Accounting to Management Accounting. Cost Accounting is a broad subject already. Like in computing, we can't merge Networking to Application Developement, even though they are in the subject of Computing. Like in Medicine, we can't merge Dental to Paediatric, even though they are in the field of medicine. If we are to merge everything related, then we should open up a subject called "General Humanity" or "Study of The Universe", or simply "Encyclopaedia" which covers everything happens to our world. - Felix (the okayman) from Hong Kong (Jan 2006)
Disagree While Cost Accounting is a large part of Managerial Accounting, it is very distinct and a large subject. Again, many universities do teach Management Accounting & Cost Accounting as different courses. Management Accounting only gives a brief introduction to Cost Accounting. It's too large of a subject to be lumped in with Management.
Disagree Cost Accounting is a sufficiently complex topic to warrant its own section. Furthermore, it is a controversial topic and continues to evolve i.e. ti&oe accounting. I vote to leave it as is. --Jimeeb 03:30, 10 March 2006 (UTC) jimeeb
Disagree They are different and both are substantial. This subject needs attention though. Signor Eclectic 22:05, 24 April 2006 (UTC)
Disagree. Cost accounting is not Management accounting and therefore should not be bundled with such. That would just confuse the matter further. —dwarfsoft (Talk) dwarfsoft 12:01, 5 June 2006 (UTC)
[edit] Biased
Seem's biased towards troughoutput accounting vs. ABC, direct costing, lean accounting and other initiatives. Details on throughoutput accounting belong in it's own page. 196.40.38.104 04:38, 2 May 2007 (UTC)
[edit] Some issues
The article states that "Cost accounting does not follow GAAP". However, in IFRS and US GAAP the valuation of inventory and work-in-progress is based on cost. GAAP requires cost accounting. Organisations which report under those accounting systems will want cost accounting systems which can produce GAAP-compliant inventory valuations at a balance sheet date.
The article describes standard cost as necessarily including allocated overheads. It is possible to have a standard costing system which only includes marginal costs. The thing which distinguishes "standard cost" is the process of setting a standard, which provides the opportunity of comparing actual costs with that standard.
The real alternatives to standard cost systems are
- actual cost systems, where an organisation measures the actual cost of products or activities; for example, a construction company measuring the actual cost of a new building;
- hybrids with some actual and some standard costs. For example, an IT services company might measure the actual numbers of hours which its staff spend on a particular project, but value the cost per hour using a standard rate for each member of staff.
The "weaknesses of standard cost accounting" as described in the article are mostly issues of using a full-cost including allocated overheads as a basis of setting minimum sales prices.
I do not think that you would be able to prove the assertion that "modern companies have few truly variable costs". This might be true for manufacturing companies with high-value, long-life capital equipment, but it is not true for for services companies or organisations which outsource their supply. Wait long enough and everything is variable.
"Throughput accounting" as described in the article is not cost accounting. The example is using a calculation of contribution per hour from the constrained resource (the metal shop).
Swinnow16 22:27, 22 August 2007 (UTC)
Agree that the "Cost accounting does not follow GAAP" comment is suspect, especially if GAAP = US-GAAP. US-GAAP pretty much forces the use of cost accounting; in particular the matching principle, which derives from the historical-cost and revenue-recognition principles. If an expense can be treated as an expense at the time it is incurred, then there is little or no need to cost anything. See Generally Accepted Accounting Principles (United States).
However, I believe "modern companies have few truly variable costs" is fair enough, although the statement could do with some clarification. All expenses will vary with time. To be "variable" in this context, they have to vary with activity without inherently changing the business (excludes restructuring). Agree that outsourcing, like casual-labour, is usually variable.
130.216.122.34 23:01, 11 September 2007 (UTC)
There is a difference between the costs assessed for financial accounting purposes and the costs that are relevant in a managerial situation. In the managerial situation costs are prepared in such a manner as to MAXIMIZE usefulness. In some situations this involves current costs not historical costs. Furthermore, cost accounting is forward looking, and many/most historical costs are ignored unless they will be incurred in the future and are not committed. Because of this, many aspects of cost accounting IGNORE GAAP, which are primarily focused on external reporting NOT internal decision making. 24.86.197.153 03:13, 6 October 2007 (UTC)
[edit] Cost Accounting systems indeed a benchmark in Management.
Total internal mangement system of any houses will be in dark without implementation of Cost Accounting System.
The price implication of any Product totally depends on the segregation of direct and indirect variables of the Cost. The acurate apportion of cost, gives an accurate figure of price control.
Besides that, with the develop of Competition and globalisation of product an Unit or Standardise Cost Accounting System is very much required for transperancy of the Stake-holders and to evaluate true & fare benchmarking of their houses.
Capital Cost or fixed cost is one of the volatile words in current thoughtput system of accouting. Because, nothing is fixed or secured in present life except the duration of service provided by the expenses incurred. In Cost Accouting System these calculation is vital for decision making by mangement expert.
Asim Mukherjee —Preceding unsigned comment added by Asim Mukherjee (talk • contribs) 15:28, 4 December 2007 (UTC)
