This refers to a range of management approaches to collecting, analysing, and evaluating the costs of a business in order to advise the business on investment and spending decisions.
Cost accounting is typically an internal activity, the results of which do not form part of the organisation’s financial statements. Its focus is on internal control and decision making. Cost accounting classifications are typically based on business functions, products, processes etc, as opposed to financial accounting classifications by type of spend (salaries, materials etc).
Cost accounting is a term normally found in management accounting.
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