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Cost plus pricing is a cost-based method for setting the prices of goods and services. Under this approach, the direct material cost, direct labor cost, and overhead costs for a product are added up and added to a markup percentage (to create a profit margin) in order to derive the price of the product.
Manufacturing cost. Manufacturing cost is the sum of costs of all resources consumed in the process of making a product. The manufacturing cost is classified into three categories: direct materials cost, direct labor cost and manufacturing overhead. [1] It is a factor in total delivery cost. [2]
Cost accounting is defined by the Institute of Management Accountants as "a systematic set of procedures for recording and reporting measurements of the cost of manufacturing goods and performing services in the aggregate and in detail. It includes methods for recognizing, allocating, aggregating and reporting such costs and comparing them with ...
Cost–benefit analysis ( CBA ), sometimes also called benefit–cost analysis, is a systematic approach to estimating the strengths and weaknesses of alternatives. It is used to determine options which provide the best approach to achieving benefits while preserving savings in, for example, transactions, activities, and functional business ...
Direct costs are directly attributable to the object. In construction, the costs of materials, labor, equipment, etc., and all directly involved efforts or expenses for the cost object are direct costs.
In industry, models of the learning or experience curve effect express the relationship between experience producing a good and the efficiency of that production, specifically, efficiency gains that follow investment in the effort. The effect has large implications for costs [3] and market share, which can increase competitive advantage over time.
Job Costing is the process of determining the labor and materials cost for each job in a systematic way, and then using this information to create a quote for the customer.
Direct costs, in accounting, are those costs which are directly accountable to a cost object (such as a particular project, facility, function or product). [1] The equivalent nomenclature in economics is specific cost. [2] Direct costs may be either fixed or variable, but typically comprise materials, labour, and specific expenses such as, e.g ...