One Hundred Cost Term in Accounting

100 Costs term 1. Absorption costing is a costing method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed overhead - as part of the cost of a finished unit of product. 2. Administrative costs are all executive, organizational, and clerical costs associated with the general management of an organization rather than with manufacturing, marketing, or selling. 3. Allocation base is a measure of activity such as direct labor-hours or machine-hours that is used to assign costs to cost objects. 4. Account analysis is a method for analyzing cost behavior in which each account under consideration is classified as either variable or fixed based on the analyst's prior knowledge of how the cost in the account behaves. 5. The amount of net cash outflow resulting from a tax-deductible cash expense after income tax effects have been considered. The amount is determined by multiplying the tax-deductible cash expense by (1 - Tax rate). 6. Activity base is a measure of whatever causes the incurrence of a variable cost. For example, the total cost of X-ray film in a hospital will increase as the number of X rays taken increases. Therefore, the number of X rays is an activity base for explaining the total cost of X-ray film. 7. Adjusted r2 is a measure of goodness of fit in least-squares regression analysis. It is the percentage of the variation in the dependent variable that is explained by variation in the independent variable. 8. After tax benefit- The amount of net cash inflow realized from a taxable cash receipt after income tax effects have been considered. The amount is determined by multiplying the taxable cash receipt by (1 - Tax rate). 9. Avoidable cost -Any cost that can be eliminated (in whole or in part) by choosing one alternative over another in a decision-making situation. In managerial accounting, this term is synonymous with Relevant cost and differential cost. 10. Action