Basic Cost Management Concepts - Chapter 2

Front 1

cost

Back 1

the cash or noncash assets sacrificed for goods and services that are expected to bring a current or future benefit to the organization

Front 2

expenses

Back 2

expired costs

Front 3

assets

Back 3

unexpired costs

Front 4

cost object

Back 4

any item, such as products, customers, departments, projects, and so on, for which costs are measured and assigned

Front 5

activity

Back 5

a basic unit of work performed within an organization

Front 6

indirect costs

Back 6

costs that cannot be traced easily and accurately to a cost object

Front 7

traceability

Back 7

the ability to assign a cost directly to a cost object in an economically feasible way by means of a casual relationship

Front 8

direct tracing

Back 8

the process of identifying and assigning costs to a cost object that are specifically or physically associated with the cost object

Front 9

drivers

Back 9

factors that cause changes in resource usage, activity usage, costs, and revenue

Front 10

driver tracing

Back 10

the use of drivers to assign costs to cost objects

Front 11

allocation

Back 11

assignment of indirect costs to cost objects

Front 12

tangible products

Back 12

goods produced by converting raw materials through the use of labor and capital inputs such as plant, land, and machinery

Front 13

services

Back 13

tasks or activities performed for a customer or an activity performed by a customer using an organization's products or facilities