Main course page
Chapter 2: Elements of Cost
This lesson introduces the element of cost in management accounting. Costs are classified as either direct or indirect with respect to the cost object. Direct cost is a cost that can be traced to the cost objects. On the other hand, indirect cost is a cost that relates to the cost object but cannot be traced to the cost object.
Upon completion this lesson, you should be able to:
- describe the cost and classification of cost in order to provide various types of cost information; and
- evaluate cost collection methods to determine at product cost