Meaning and Definition
(i) Cost-As a noun-The amount of expenditure (actual or notional) incurred on or attributable to a specified article, product or activity.
As a verb- To ascertain the cost of a specified thing or activity.
(ii) Costing- Costing is defined as “the technique and process of ascertaining costs”.
According to CIMA “an organisation’s costing system is the foundation of the internal financial information system for managers. It provides the information that management needs to plan and control the organisation’s activities and to make decisions about the future.”
(iii) Cost Accounting-Cost Accounting is defined as “the process of accounting for cost which begins with the recording of income and expenditure or the bases on which they are calculated and ends with the preparation of periodical statements and reports for ascertaining and controlling costs.”
(iv) Cost Accountancy-Cost Accountancy has been defined as “the application of costing and cost accounting principles, methods and techniques to the science, art and practice of cost control and the ascertainment of profitability. It includes the presentation of information derived there from for the purpose of managerial decision making.”
(v) Management Accounting-As per CIMA Official Terminology “Management accounting is the application of the principles of accounting and financial management to create, protect, preserve and increase value for the stakeholders of for-profit and not-for-profit enterprises in the public and private sectors.”
Management accounting is an integral part of management. It assists management by provision of relevant information for planning, organising, controlling, decision making etc.
(vi) Cost Management- It is an application of management accounting concepts, methods of collections, analysis and presentation of data to provide the information needed to plan, monitor and control costs.
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