CAS - 3 areas of Cost Accounting

Measurement of Costs

Measurement of Costs involves the methods and techniques used in defining the components of costs, determining the basis of cost measurement, and establishing criteria for use of alternative cost measurement techniques. Examples of cost measure are:

• The use of standard or actual costs; or
• The designation of items of cost which must be included or excluded.

Assignment of Costs to Cost Accounting Period

The assignment of cost to cost accounting periods refers to the method used in determining the amount of costs to be assigned to individual cost accounting periods.

Allocation of Cost to Cost Objectives

This refers to the method used in determing of determining direct and indirect allocation of costs.