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Accounting /Cost and Management Accounting Essentials

Cost and Management Accounting Essentials

Accounting10 CardsCreated about 1 month ago

This deck covers key concepts, definitions, and objectives of cost and management accounting, including the differences between financial, cost, and management accounting.

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What is the definition of 'cost' according to CIMA?

Cost is defined as the amount of expenditure incurred or attributed on a given thing, including direct material, direct labor, and indirect expenses.

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Key Terms

Term

Definition

What is the definition of 'cost' according to CIMA?

Cost is defined as the amount of expenditure incurred or attributed on a given thing, including direct material, direct labor, and indirect expenses.

What is Cost Accountancy?

Cost Accountancy is the application of costing and cost accounting principles to ascertain profitability and aid in management decision-making.

Define Cost Accounting as per CIMA.

Cost Accounting is the process of accounting for cost from expenditure to its relationship with cost centers and units, involving cost control and pro...

What is the primary objective of Cost Accounting?

The primary objectives are cost ascertainment, cost control, profitability analysis, and providing information for management decisions.

List two functions of Cost Accounting.

1. To work out cost per unit of products. 2. To provide data for setting selling prices.

What is Management Accounting?

Management Accounting involves identifying, presenting, and interpreting information for strategy formulation, planning, and decision-making.

How does Management Accounting differ from Cost Accounting?

Management Accounting focuses on using accounting data for planning and control, while Cost Accounting focuses on cost determination and control.

What are some activities included in Management Accounting?

Activities include budgeting, performance measurement, advising on product mix, and strategic decision-making.

What is the role of Costing in Cost Accounting?

Costing involves classifying, recording, and allocating expenditure to determine product or service costs for management control.

Why is Management Accounting considered a necessity?

It utilizes data from Cost and Financial Accounting for planning, coordination, and control, aiding in decision-making.

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Cost and Management Accounting Essentials

Term	Definition
What is the definition of 'cost' according to CIMA?	Cost is defined as the amount of expenditure incurred or attributed on a given thing, including direct material, direct labor, and indirect expenses.
What is Cost Accountancy?	Cost Accountancy is the application of costing and cost accounting principles to ascertain profitability and aid in management decision-making.
Define Cost Accounting as per CIMA.	Cost Accounting is the process of accounting for cost from expenditure to its relationship with cost centers and units, involving cost control and profitability analysis.
What is the primary objective of Cost Accounting?	The primary objectives are cost ascertainment, cost control, profitability analysis, and providing information for management decisions.
List two functions of Cost Accounting.	1. To work out cost per unit of products. 2. To provide data for setting selling prices.
What is Management Accounting?	Management Accounting involves identifying, presenting, and interpreting information for strategy formulation, planning, and decision-making.
How does Management Accounting differ from Cost Accounting?	Management Accounting focuses on using accounting data for planning and control, while Cost Accounting focuses on cost determination and control.
What are some activities included in Management Accounting?	Activities include budgeting, performance measurement, advising on product mix, and strategic decision-making.
What is the role of Costing in Cost Accounting?	Costing involves classifying, recording, and allocating expenditure to determine product or service costs for management control.
Why is Management Accounting considered a necessity?	It utilizes data from Cost and Financial Accounting for planning, coordination, and control, aiding in decision-making.