Principles Of Cost Accounting (ACC2052)

Contents Covered

• Managerial Accounting Basics

• Difference Between Financial and Managerial Accounting
• Manufacturing Cost
• Cost of Goods Manufactured Schedule
• Income statement of Manufacturing Company
• Solved Problems
• Self test Questions
Learning Objectives :
After Going through these slide you will be able to understand basic Cost Principles,
Manufacturing cost Concept, To prepare Cost of goods Manufactured Schedule and Income
statement of Manufacturing Company
Management Functions
Three Broad functions
1. Planning 2. Organizing 3. Controlling

Managerial Cost Concept

To perform the management functions effectively management needs
information. The important information is related to cost , such as
2. What cost are involved in making a product
3. If Production volume is decreased will the cost decreased ?
4. What impact will automation have on total cost ?
5. How cost be best controlled in the organization
Manufacturing Cost

It consist of activities and processes that convert raw materials into

finished goods , contrast this type of operation with merchandising ,
which sells merchandise in the form in which it is purchased .
Manufacturing Costs are typically classified as
1. Direct Materials
2. Direct Labor
3. Manufacturing overhead
Manufacturing Cost
The End