Cost Unit - Introduction to Cost Accounting, Cost Accounting Video Lecture | Cost Accounting - B Com

application of cost accounting cost
accounting is generally considered as
being applicable only to manufacturing
concerns this is not so its applications
are in fact much wider all types of
activities manufacturing and non
manufacturing in which monetary value is
involved should consider the use of cost
accounting wholesale and retail business
banking and insurance companies railways
Airways shipping row transport companies
hotels hospitals schools colleges
universities forming Sigma houses all
may employ cost accounting techniques to
operate efficiently it is only a matter
of recognition by the management of the
applicability of this costing concepts
and techniques in their own fields of
end of arrow see application of costing
mainly depends on the management how to
use and how to use it efficiently to run
the companies into profit modes so the
application of cost of holding is mainly
depends on all the companies whatever it
may be and it only depends on the
application of cost accounting by the
management next we comes to the concept
of cost the term cost does not have a
definite meaning I mean its scope is
extremely both but in general it is
therefore not easy to define our explain
this
without leaving any doubt concerning its
meaning Cost Accountant economists and
others develop the concept of cost
according to their needs because one
complete description of the cost to
shoot all the situations is not possible
according to the oxford dictionary cost
means the price pay for something
however some of the definitions are
given below cost is the amount of
expenditure actual emotional incurred
are attributable to a given T next there
are many other definitions also we may
have looked at it cost is a measurement
in monetary terms of the amount of the
resources used for the purpose of
production of goods or services it is
issued by ICWA of india a cost is the
value of economic resources used as a
result of producing are doing the things
costed it is given by harper cost means
the economic sacrifice measured in terms
of standard monetary unit incurred or
potentially to be incurred as a
consequence of a business decision to
achieve a specific objective it is given
by the American accounting Association
now let us come to the definition of a
center a core Center is defined by the
cyma of UK as a location or a person or
an item of equipment or group of this
for which cost may be ascertained and
used for the purpose of control thus a
cost center refers rare situation of the
business to which cost can be charged it
may be by a location
or an equipment for which cost maybe
acetate or a person or a group of group
of machines automata by one word meant
the main purpose of ascertaining the
cost of a cost Center is control of cost
there are primarily two types of cost
center one is personal power center and
other one is impersonal cost center
partial console the cost centers means
which consists of a person or a group of
persons in personal cost centers means
which consists of a location or an item
of an equipment or group of these on the
functional basis because centers may be
of the following two - production cost
center service cost Center this is that
cost center where the actual production
work takes place examples melting shop
machine department welding Department
finishing shop etc service cost center
this is back cost vendor which has
angular e2 and render these services to
production cost center examples of
service cost centers are powerhouse
total storage department repair shop
canteen etc cost incurred in service
cost centers are of industry indirect
type a Cost Accountant sets of cost
centers to enable him to ascertain the
cost he needed to know a cost center is
charged with all the cost that led to it
for example if a cost center is a
machine it will be
saddled with cost of power light
depreciation I its share of rent etc the
purpose of ascertaining the cost of a
cost center is cost control the person
in charge of a cost center is held
responsible for the control of cost
center of that it has been seen from the
cost centers that help in ascertaining
the cost by location equipment or a
percent cost unit is a step further
which breaks of the cost of a cost
center into smaller subdivisions and
helps in ascertaining the cost of a
saleable products or services here live
comes as the definition it is issued by
SEMA unit of product or service or time
in relation in which cost may be
ascertained or expressed cost units are
the things that the business is set up
to provide of which cost is ascertained
for example in a sugar mill the cost per
ton of sugar may be ascertained in a
textile mill the cost per meter of cloth
may be ascertained
thus a ton of sugar and a meter of cloth
are cost units in short cost unit is a
unit of measurement of post all sorts of
cost units are adapted for adoption
being the applicability of a particular
cost you need to the circumstances under
the consideration broadly cost units may
be further divided into two types units
of production units of service units of
production for example a kilogram of a
key
a ream of paper a ton of Steel a middle
of cable etc on a kilometer Atkin
kilometer a CMOS it a consulting car etc
a few more examples of cost units in a
various industries are given below
Cement pad chemicals tan bricks per
thousand big nursing home Bedford a
pencil doesn't shoes
there are dozen electricity kilowatt
hour auto mobile member cotton bail
trading with thousand copies soft drink
thousand create of 24 bottles up to
where bodies floor done transport
passenger kilometer are 10 kilometer
timber cubic food minds a ton of mineral
carpets square foot hotel room per day
gas cubic feet or cubic meter the cost
unit and cost Center should be those
which are natural to business and which
are readily understood and accepted by
all the concerns methods of costing here
way comes to the topic the methods or
types of costing refer to the methods
employed in the ascertainment of cost
several methods have been designed to
suit the needs of the different
industries these methods of costing are
as follows job order costing contract
costing batch costly process costing
operation costing single or unit costing
multiple our composite costing here we
have a brief discussion of this in the