CHAPTER 01 COST ACCOUNTING: info for decision making

overview of cost accounting

Value Chain

The set of activities that transforms raw resources into the goods and services end users (households for example) purchase and consume.

Value-added Activities

Activities that customers perceive as adding utility to the goods or services they purchase

Research and Development (R&D)

The creation and development of ideas related to new products, services, or processes

Design

The detail development and engineering a product services or processes

Production

The collection and assembly of resources to produce a product or deliver a service

Marketing and Sales

The process of informing potential customers about the attributes of products or services that leads to their sale

Distribution

The process for delivering products and services to customers

Customer Service

The support activities provided to customer customers for a product or service.

Purchasing

The acquisition of goods and services needed to produce a good or service

Supply Chain

Set a firms and individuals that sells goods and services to the firm

Distribution Chain

Set a firms and individuals that buys and distributes, goods and services from the firm

Outsourcing

Accompany that chooses to have other firms produce parts used in its final product or deliver the service

In-sourcing

Companies that decide to do this work internally

Financial accounting

Field of accounting, that reports Financial position and income, according to accounting rules

Cost accounting

Field of accounting that measures records and report information about costs

Generally accepted accounting principles (GAAP)

Rules, standards, and conventions that guide the preparation of financial accounting statements for firms registered in the US

International financial reporting standards (IFRS)

Rules, standards and conventions that guide the preparation of the financial accounting statements in many other countries