What Is Cost Accounting?
                     What Is Cost 
Accounting?
Introduction
Cost Accounting is a business 
practice in which we record, 
examine, summarize, and 
study the company’s cost 
spent on any process, 
service, product or anything 
else in the organization.
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Improve cost 
efficiency
This helps the organization in 
cost controlling and making 
strategic planning and 
decision on improving cost 
efficiency. Such financial 
statements and ledgers give 
the management visibility on 
their cost information.
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Types of cost 
accounting
There are different types of 
cost accounting such as 
marginal costing, activity-
based costing, standard cost 
accounting, lean accounting. 
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Cost 
Accounting
It is a process via which we 
determine the costs of goods 
and services. It involves the 
recording, classification, 
allocation of various 
expenditures, and creating 
financial statements. This 
data is generally used in 
financial accounting.
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Features of 
Cost 
Accounting
It is a sub-field in accounting. 
It is the process of 
accounting for costs
Provides data to 
management for decision 
making and budgeting for 
the future
It helps to establish certain 
standard costs and budgets.
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Features of 
Cost 
Accounting 
Cont.
Provides costing data that 
helps in fixing prices of 
goods and services
It also a great tool to figure 
out the efficiency of a unit or 
a process. It can disclose 
wastage of time and 
resources
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Standard 
Accounting
Standard costing is a 
technique where the firm 
compares the costs that 
were incurred for the 
production of the goods and 
the costs that should have 
been incurred for the same.
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Marginal 
Costing
This type of costing is based 
on the principle of dividing 
all costs into fixed cost and 
variable cost.
Fixed costs are unrelated to 
the levels of production. As 
the name suggests these 
costs remain the same 
irrespective of the production 
quantities.
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Importance 
and 
Objectives of 
Cost 
Accounting
Classification of Cost
Cost Control
Price Determination
Fixing of Standards
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Advantages
Measuring and Improving 
Efficiency
Identification of Unprofitable 
Activities
Fixing Prices
Price Reduction
Control over Stock
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