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WHAT and how to attribute to costs


What and how to attribute to costs</a>

The costs of production and sale of goods are the sum of costs for various factors, for example, materials, fixed assets, raw materials, fuel, labor, etc.

Expressed costs are usually in cash.



Total costs are the amount of moneyCompany spent on production. To calculate them, add up the fixed and variable costs of the firm. To calculate the average costs for a certain period, divide the total costs by the number of goods released.


Imputed or economic costs areAn indicator of the economic costs incurred by the enterprise. These costs include the resources acquired by the organization, its internal resources, as well as profit. There are also accounting costs that imply the costs that the company incurs to purchase certain factors of production. Accounting costs can not exceed economic, because they take into account only real costs aimed at acquiring the necessary resources from external suppliers, which is a legal fact and is the basis for indication in accounting.


Accounting costs are divided into direct andIndirect. Direct costs include expenses spent only on production. Indirect costs include all the costs that an enterprise needs for its normal functioning: overhead, depreciation, interest payments to banks, etc.


Another group is alternativeCosts, which are means aimed at the production of additional goods and the provision of special services that are not the main direction of the enterprise. It is customary to attribute all costs or future costs to alternative costs on the basis of a financial analysis and production plan. To determine the alternative costs, you need to deduct accounting costs from economic expenses.

WHAT and how to attribute to costs Was last modified: May 21st, 2017 By Lyqqoahs
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