Costing 1 PDF

BM2209 OVERVIEW OF COSTING Definition of Costing Costing refers to the method and process of ascertaining the costs. It involves classifying, recording, and allocating an organization's expenditure to determine the costs of products or services. Also, it req...

BM2209 OVERVIEW OF COSTING Definition of Costing Costing refers to the method and process of ascertaining the costs. It involves classifying, recording, and allocating an organization's expenditure to determine the costs of products or services. Also, it requires the presentation of suitably arranged data for management control and guidance. The major objectives of costing are the following: To determine the cost incurred during each operation to control wages. To provide data that establish a product's selling price and a company's pricing policies. To provide information about the economic consideration in purchasing materials. To help the management make decisions, detect wastages, and reduce total manufacturing costs. Concepts of Costs The following are the different definitions of cost: It is the number of resources used in exchange for goods or services. It is the amount of expenditure incurred on or attributable to a specified object or activity. It is an initial value, measured in monetary terms, incurred or potentially to be incurred to achieve a specific objective. Costs must be assessed in different aspects as follows: 1. Nature of business. A cost has to be studied concerning the nature of business. For example, a manufacturing organization is interested in knowing the cost per unit of its product. In contrast, the organizations rendering services such as electricity and transport are interested in determining the costs of services they undertake. The cost per unit can be easily determined by dividing the total expenditure by the number of units produced or total services rendered. 2. Purpose. A cost must be studied with its purpose. For example, the goal is a fixation on selling price cost. All expenditure items relating to production, administration, and selling will have to be included. But if the purpose is the valuation of inventories, only the cost of production will have to be considered. Hence, the concept of cost varies according to the goal. 3. Conditions. A cost must be determined under different conditions. For instance, while dealing with inventory, work-in-progress is valued at factory cost, whereas the stock of finished goods is valued at production cost. 4. Context. Cost is a generic term that must be recognized or qualified. It is generally used to include all the various types of expenditures. However, when the term cost is used specifically, it is always modified concerning the context of the different types of cost like fixed cost, variable cost, and sunk cost, among others. Each type of cost implies a certain attribute important in computing and measuring the cost. Classification of Costs Costs can be classified into different categories for different purposes as follows: a) According to Management Function Manufacturing costs. It refers to the costs incurred in the factory for converting raw materials into finished goods. It includes the cost of raw materials, direct labor, and the costs incurred during the manufacturing process or factory overhead. Non-manufacturing costs. It refers to the costs not incurred for transforming materials into finished goods. These include selling expenses such as advertising costs, delivery expenses, salaries, and 01 Handout 1 *Property of STI  [email protected] Page 1 of 9  BM2209 commission. It also includes administrative expenses such as salaries of executives and legal expenses. b) According to Ease of Traceability Direct costs. It refers to the costs that can be traced directly to a particular object of costing such as a particular product, department, or branch. Examples include materials and direct labor. Some operating expenses can also be classified as direct costs, such as advertising costs for a particular product. Indirect costs. It refers to the costs that cannot be traced to a particular object of costing. They are also called common costs or joint costs. Examples include factory overhead and operating costs associated with more than one (1) product, department, or branch. c) According to Timing of Charge Against Revenue Product costs. It refers to the costs that form part of the inventory and are charged against revenue. They are also called inventoriable costs. It includes manufacturing costs such as direct materials, direct labor, and factory overhead. Period costs. It refers to the costs that are not inventoriable and are immediately charged against revenue. It includes non-manufacturing costs such as selling expenses and administrative expenses. d) According to Accounting Period-Wise Classification of Costs Capital expenditure: It refers to the expenditure resulting in an asset's acquisition. It also pertains to extending or enhancing earning capacity at a smaller cost. It is classified as a fixed asset. Examples of this include costs of acquiring land, building, and machinery. Revenue expenditure: It refers to the expenditure which occurs for maintaining assets in working conditions and is not intended to increase the revenue-earning capacity. A revenue expenditure benefits the current accounting period. It is treated as an expense. e) According to Relevance to Decision-making Overhead cost. It refers to the ongoing business expenses not including or related to direct labor or direct materials used in creating a product or service like rent, utilities, and insurance. Standard cost. It refers to the predetermined cost based on some reasonable basis, such as past experiences, budgeted amounts, and industry standards. Opportunity cost. It refers to the benefit forgone or given up when an alternative is chosen over the other/s. For instance, if a business decides to use its building for production rather than renting it out to its tenants, the opportunity cost would be the rent income that would be earned had the business decided to rent out the building. Sunk costs. It refers to the historical costs that will not make any difference in decision-making. Examples include the acquisition cost of office equipment and the manufacturing costs of finished goods on hand. Committed costs. It refers to the costs resulting from an organization’s structure or the use of its facilities. Examples include property taxes, salaries of management personnel, and the cost of renting facilities. Discretionary costs. It refers to the costs resulting from a management decision to spend a particular amount of money for a specific purpose. Examples include spending money on research and development, contributions to charitable institutions, and advertising. Controllable costs. It refers to the costs that can be influenced or controlled by a supervisor or manager for a given period. An example of this is the control of a supervisor on company expenditures such as the purchase of office supplies and the maximum overtime a rank-and-file employee may render. 01 Handout 1 *Property of STI  [email protected] Page 2 of 9  BM2209 f) According to Behavior under Activity Fixed costs. These are constant costs that do not change with an increase or decrease in the number of goods or services produced and sold. The changes in the number of goods and services produced or sold are classified as Total cost (Pesos) 15 Fixed Cost Line the activity with a designated relevant range 10 or boundary of minimum and maximum activity levels. The cost of production or unit 5 cost of goods and services may vary as the 0 activity level increases or decreases, while 1 2 3 4 5 6 the total fixed cost remains constant. Examples include supervision fees, factory Volume of Production (Units) rent, insurance, and taxes. Figure 1. Fixed cost ILLUSTRATION: ABC Manufacturing has the following monthly expenses, which present the breakdown of their factory rent and the cost of production for its three (3) major products: liquid detergent, baking soda, and paper towels. The management sets the ideal production or relevant range within 8,000 – 10,000 units for a given month. Factory Rent (Total Fixed Cost) P100,000 Use the following formula to solve for the Production in Units: Fixed Cost (FC) per unit: Liquid detergent 8,000 𝑇𝑜𝑡𝑎𝑙 𝐹𝑖𝑥𝑒𝑑 𝐶𝑜𝑠𝑡 Baking soda 9,000 𝐹𝐶 = Paper towels 9,500 𝑃𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛 Relevant Range 8,000 - 10,000 Liquid detergent Baking soda Paper towels Total Fixed Cost (Rent) P100,000 P100,000 P100,000 Production 8,000 9,000 9,500 Fixed Cost (FC) per Unit P12.50 P11.11 P10.53 ANALYSIS: The factory rent, which is the total fixed cost, is the same for the three (3) products. However, the fixed cost per unit decreases as production increases within the relevant range. Variable costs. These costs vary in total, in direct proportion to changes in production volume. Variable cost is a constant amount on a per unit basis as activity changes within a 150 relevant range. As activity changes, the total Total cost (Pesos) Total Variable Cost Line variable cost increases or decreases 100 proportionately with the change, but the 50 unit variable cost remains the same. Examples include direct materials, direct 0 labor, overtime premium, materials 1 2 3 4 5 6 handling costs, and maintenance costs. Volume of Production (Units) Figure 2. Variable cost 01 Handout 1 *Property of STI  [email protected] Page 3 of 9  BM2209 ILLUSTRATION: The primary component of the bestselling perfume of Kisses Inc. is the plant substance of citrus fruits which costs the company P5.00 for each bottle of production. The company’s floor workers handle the perfume production with an associated piece rate of P6.00 for each bottle they produce. Also, the company's estimated advertising expense or overhead cost is P3.00 per bottle. The following is the summary of the company’s incurred costs of unit production for each perfume line: Production in Units: Variable Cost per Unit: Magical Citrus 8,000 Direct Materials (citrus fruits) P5.00 Wild Citrus 9,000 Direct Labor (salary of floor workers) 6.00 Victoria’s Citrus 9,500 Overhead (advertising expense) 3.00 Total Variable Cost P14.00 Use the following formula to solve for the Total Variable Cost (TVC): 𝑇𝑉𝐶 = 𝑃𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛 𝑖𝑛 𝑢𝑛𝑖𝑡𝑠 × 𝑉𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 Magical Citrus Wild Citrus Victoria’s Citrus Production in Units 8,000 9,000 9,500 Variable Cost per Unit P14.00 P14.00 P14.00 Total Variable Cost P112,000 P126,000 P133,000 ANALYSIS: The variable cost per unit is constant at P14.00 per unit, but as the production of each perfume line increases, the total variable cost increases. Mixed Costs. These costs vary in total but not in proportion to activity changes. It includes both fixed and variable components. 120 Fixed Cost 100 Total Cost (Pesos) 80 Variable Cost 60 40 20 0 1 2 3 4 5 6 Volume of Production (Units) Figure 3. Mixed cost ILLUSTRATION: A water company charges a fixed amount of P200.00 for using less than or equivalent to 500 gallons of water on a given month. Also, the company imposes an additional P1.00 charged for each gallon consumed more than the 500-gallon base. The fixed component in the given scenario is the P200.00 charged for consuming less than or equivalent to 500 gallons of water, while the variable component is the additional P1.00 charge for consuming more than 500 gallons of water on a given month. 01 Handout 1 *Property of STI  [email protected] Page 4 of 9  BM2209 Step Costs. These costs remain unchanged or constant for a given output level and then increase by a fixed amount at a higher output level, i.e., from one level of output to another higher level. An example of this is the salary of supervisors in a factory. Depending upon the period up to which an expense can be kept up to a certain level despite the increase in activity, the height and width of steps vary. If the steps are small and narrow, the behavior of cost is like that of “pure variable cost.” This is called “step variable cost.” On the other hand, if the steps are wider, the cost is like that of a “fixed cost.” This is called “step fixed cost.” ILLUSTRATION: In a goods importing company, where the freight charge of Php 1,000 will have an additional Php 1,000 for every 1 cubic meter of finished goods in excess each time they deliver. Thus a volume of 1.8 cubic meters of goods will cost Php 2,000, and the 2.5 cubic meters will be charged at Php 3,000. Then the very narrow cost level increases from one range to the next and can be categorized as Step Variable Cost. Figure 4. Step variable cost Source: Costing Accounting, 2010 ILLUSTRATION: Assume that a supervisor can effectively supervise 20 workers. A second supervisor would be needed if workers exceed 20, and a third supervisor if workers exceed 40, and so on. There would be a sudden increase in the salary of the supervisors. If the activity level increases from one range to the next in a wider scope, it can be categorized as Step Fixed Cost. Figure 5. Step fixed cost Source: Costing Accounting, 2010 01 Handout 1 *Property of STI  [email protected] Page 5 of 9  BM2209 Separating Mixed Cost The procedure for separating mixed costs involves using the high-low method on a given set of data within the relevant range. ILLUSTRATION: Machine hours and utility costs for DKNY Industries in year 201A were as follows: Month Machine Hours Utility Costs January 2,500 P36,800 February 2,900 42,000 March 1,900 27,000 April 3,100 46,000 May 3,800 56,500 June 3,300 44,000 July 4,100 49,500 August 3,500 45,500 September 2,000 31,000 October 3,700 52,000 November 4,700 62,000 December 4,200 55,500 Table 1. DKNY Industries Source: Cost Accounting, 2016, p.13 PROCEDURE: 1. Select the highest and lowest levels of activity and costs within the data set. Machine Hours Utility Costs Highest 4,700 P62,000 Lowest 1,900 27,000 Difference 2,800 P35,000 2. Compute the variable cost element using the following formula: 𝐶ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝐶𝑜𝑠𝑡 𝑉𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝐶𝑜𝑠𝑡 (𝑉𝐶) 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 = 𝐶ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝐴𝑐𝑡𝑖𝑣𝑖𝑡𝑦 𝐶ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑢𝑡𝑖𝑙𝑖𝑡𝑦 𝑐𝑜𝑠𝑡𝑠 𝑃35,000 𝑉𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝐶𝑜𝑠𝑡 (𝑉𝐶) 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 = = = 𝑷𝟏𝟐. 𝟓𝟎 𝒑𝒆𝒓 𝒎𝒂𝒄𝒉𝒊𝒏𝒆 𝒉𝒐𝒖𝒓 𝐶ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑚𝑎𝑐ℎ𝑖𝑛𝑒 ℎ𝑜𝑢𝑟𝑠 2,800 3. Compute the variable cost at the highest and lowest level of activity using the following formula: 𝑉𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 = 𝐻𝑖𝑔ℎ𝑒𝑠𝑡 𝑜𝑟 𝑙𝑜𝑤𝑒𝑠𝑡 𝑙𝑒𝑣𝑒𝑙 𝑎𝑐𝑡𝑖𝑣𝑖𝑡𝑦 × 𝑉𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 𝐻𝑖𝑔ℎ𝑒𝑠𝑡 𝑙𝑒𝑣𝑒𝑙 = 4,700 × 12.50 = 𝑷𝟓𝟖, 𝟕𝟓𝟎 𝐿𝑜𝑤𝑒𝑠𝑡 𝑙𝑒𝑣𝑒𝑙 = 1,900 × 12.50 = 𝑷𝟐𝟑, 𝟕𝟓𝟎 4. Determine the fixed cost at each level of activity using the following formula: 𝐹𝑖𝑥𝑒𝑑 𝑐𝑜𝑠𝑡 = 𝐻𝑖𝑔ℎ𝑒𝑠𝑡 𝑜𝑟 𝑙𝑜𝑤𝑒𝑠𝑡 𝑐𝑜𝑠𝑡𝑠 − 𝑉𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡 𝑎𝑡 𝑒𝑎𝑐ℎ 𝑙𝑒𝑣𝑒𝑙 𝑜𝑓 𝑎𝑐𝑡𝑖𝑣𝑖𝑡𝑦 𝐻𝑖𝑔ℎ𝑒𝑠𝑡 𝑙𝑒𝑣𝑒𝑙 = 𝑃62,000 − 𝑃58,750 = 𝑷𝟑, 𝟐𝟓𝟎 𝐿𝑜𝑤𝑒𝑠𝑡 𝑙𝑒𝑣𝑒𝑙 = 𝑃27,000 − 𝑃23,750 = 𝑷𝟑, 𝟐𝟓𝟎 01 Handout 1 *Property of STI  [email protected] Page 6 of 9  BM2209 Inventory Accounts Most companies particularly in the manufacturing industry, maintain the following inventory accounts: Raw Materials Inventory. This shows the available raw materials to use in the manufacturing process. It is a controlling account if the company maintains only one account for direct and indirect materials. Work-in-Process Inventory. This represents the costs of partially completed goods on which production activities have been started but not yet completed as of a certain period. Finished Goods Inventory. This summarizes the costs of the completed job stored in the warehouse for delivery to the customers. Raw Materials Inventory System Manufacturing companies commonly use the following inventory systems: Perpetual Inventory System. This system requires the need to maintain stock cards or records of the status of the goods held in the inventory for each type of raw materials, which reflects the summary of the inflow, outflow, and balance of raw materials in quantity and peso amount. Although the quantity of raw materials is available at any time by referring to the stock card, this system also requires physical counting of raw materials at least once a year to confirm the balance reflected in the material stock cards. Periodic Inventory System. This system does not require a stock card for the raw materials; however, a physical count of raw materials must be facilitated periodically to determine the units on hand. The Flow of Manufacturing Costs The flow of manufacturing costs is based on the following illustration: Chart 1. Flow of costs Source: Cost Accounting, 2016, p.19 The flow of costs of a manufacturing company is outlined as follows: 1. Purchase of Raw Materials. It involves the acquisition of raw materials needed for production. Most manufacturing companies use a perpetual inventory system where purchases and issuance of raw materials are recorded directly in the raw materials inventory account as they occur. 2. Issuance of Raw Materials. It involves delivering raw materials to production through a requisition slip properly accomplished and approved by the production manager. The cost of issued raw materials can be classified under work-in-process inventory. 01 Handout 1 *Property of STI  [email protected] Page 7 of 9  BM2209 3. Return of Excess Materials. It involves the returning of excess raw materials to the storage room. 4. Factory Labor Incurred. It involves temporarily accumulating the compensation of factory workers and other personnel in a factory payroll account when it is incurred, whether it is paid immediately or not. 5. Distribution of Factory Labor. It involves sorting the time tickets or written records of an employee's total hours in each pay period and segregating the direct and indirect labor costs. The salaries of direct laborers or factory workers are classified under the work-in-process account. In contrast, the salaries of indirect laborers like the manager, supervisor, clerk, and maintenance personnel are classified under manufacturing overhead. 6. Manufacturing Overhead Incurred. It involves charging the actual overhead cost in production to a manufacturing overhead account when it is incurred. Other manufacturing costs such as expired insurance and depreciation of factory plant and equipment are charged to the manufacturing overhead account only at the end of the year. 7. Actual Factory Overhead Charged to the Job. It involves transferring the actual overhead to the work-in-process account. 8. Completion of the Job. It involves transferring the accumulated cost of production summarized in the work-in-process account to the finished goods account. 9. Sale of the Completed Job. It involves setting the price for the completed job. The most common method in setting prices is the Cost-Plus Pricing method. In this method, the costs include both production costs and administrative and selling costs. The firm's desired profit and competitors' prices are the other factors that must be considered in setting the price. Methods of Accumulating Product Costs The following are the methods of accumulating product costs: Actual Costing System This method requires that all production overhead is available before any cost allocation to the jobs in the process. Under this system, the actual costs of direct materials used, direct labor, and manufacturing overhead incurred in production are charged to the job to determine the cost of specific products. Use the following formula to compute the costs associated with the product using the actual costing system: 𝐴𝑐𝑡𝑢𝑎𝑙 𝐶𝑜𝑠𝑡 = 𝐴𝑐𝑡𝑢𝑎𝑙 𝐷𝑖𝑟𝑒𝑐𝑡 𝐶𝑜𝑠𝑡 + 𝐴𝑐𝑡𝑢𝑎𝑙 𝑂𝑣𝑒𝑟ℎ𝑒𝑎𝑑 𝐶𝑜𝑠𝑡 EXAMPLE: High Street Manufacturing has the following account balances at the end of their production cycle for January: Direct Labor P120,000 Direct Materials 162,000 Manufacturing Overhead 74,000 Total Actual Cost P 356,000 SOLUTION: 𝐴𝑐𝑡𝑢𝑎𝑙 𝐶𝑜𝑠𝑡 = (𝐷𝑖𝑟𝑒𝑐𝑡 𝐿𝑎𝑏𝑜𝑟 + 𝐷𝑖𝑟𝑒𝑐𝑡 𝑀𝑎𝑡𝑒𝑟𝑖𝑎𝑙𝑠) + 𝐴𝑐𝑡𝑢𝑎𝑙 𝑂𝑣𝑒𝑟ℎ𝑒𝑎𝑑 𝐶𝑜𝑠𝑡 = (𝑃120,000 + 162,000) + 74,000 = 𝑃282,000 + 74,000 = 𝑷𝟑𝟓𝟔, 𝟎𝟎𝟎 KEY POINTS: Based on the illustration, direct labor and direct materials are added because they are classified as actual direct costs. Then, the total cost or actual cost will be derived by adding the actual direct costs and actual overhead cost, which is the given manufacturing overhead. 01 Handout 1 *Property of STI  [email protected] Page 8 of 9  BM2209 Normal Costing System This method requires the costs of direct materials and direct labor to be charged to the job. Under this system, the manufacturing overhead applied to production differs because a predetermined overhead rate is used in computing the amount of overhead charged to the job. The predetermined overhead rate is the ratio of the estimated total overhead to the estimated total cost driver selected. A company may employ plant-wide rates or departmental rates. Suppose several rates or departmental rates are used. In that case, the budgeted manufacturing overhead is divided into several cost pools and uses each driver as the denominator in computing for the predetermined overhead rate. Use the following formula to compute the costs associated with the product using a normal costing system: 𝑁𝑜𝑟𝑚𝑎𝑙 𝐶𝑜𝑠𝑡 = 𝑃𝑟𝑒𝑑𝑒𝑡𝑒𝑟𝑚𝑖𝑛𝑒𝑑 𝑂𝑣𝑒𝑟ℎ𝑒𝑎𝑑 𝑟𝑎𝑡𝑒 × 𝐴𝑐𝑡𝑢𝑎𝑙 𝐷𝑖𝑟𝑒𝑐𝑡 𝐿𝑎𝑏𝑜𝑟 𝐻𝑜𝑢𝑟𝑠 𝑢𝑡𝑖𝑙𝑖𝑧𝑒𝑑 EXAMPLE: High Street Manufacturing Company has the following account balances at the end of their production cycle for February: Fixed Cost P1,000,000 Variable Cost per Direct Labor Hours (DLH) 40 Budgeted annual Direct Labor Hours (DLH) 125,000 Actual Direct Labor Hours utilized 150,000 SOLUTION: 1. The first step is to get the predetermined overhead rate using the formula: 𝐵𝑢𝑑𝑔𝑒𝑡𝑒𝑑 𝑚𝑎𝑛𝑢𝑓𝑎𝑐𝑡𝑢𝑟𝑖𝑛𝑔 𝑜𝑣𝑒𝑟ℎ𝑒𝑎𝑑 𝑃𝑟𝑒𝑑𝑒𝑡𝑒𝑟𝑚𝑖𝑛𝑒𝑑 𝑂𝑣𝑒𝑟ℎ𝑒𝑎𝑑 𝑟𝑎𝑡𝑒 = 𝐵𝑢𝑑𝑔𝑒𝑡𝑒𝑑 𝑝𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑜𝑛 𝑎𝑐𝑡𝑖𝑣𝑖𝑡𝑦 𝑃1,000,000 + (125,000 × 40) 𝑃1,000,000 + 5,000,000 𝑃6,000,000 = = = = 𝑷𝟒𝟖 𝒑𝒆𝒓 𝑫𝑳𝑯 125,000 𝐷𝐿𝐻 125,000 𝐷𝐿𝐻 125,000 𝐷𝐿𝐻 KEY POINTS: Take note that the budgeted manufacturing overhead is the sum of the fixed cost and variable cost multiplied by the budgeted annual direct labor hours. The budgeted production activity is the budgeted annual direct labor. 2. To get the normal cost, substitute the values to the formula: 𝑁𝑜𝑟𝑚𝑎𝑙 𝐶𝑜𝑠𝑡 = 𝑃𝑟𝑒𝑑𝑒𝑡𝑒𝑟𝑚𝑖𝑛𝑒𝑑 𝑂𝑣𝑒𝑟ℎ𝑒𝑎𝑑 𝑟𝑎𝑡𝑒 × 𝐴𝑐𝑡𝑢𝑎𝑙 𝐷𝑖𝑟𝑒𝑐𝑡 𝐿𝑎𝑏𝑜𝑟 𝐻𝑜𝑢𝑟𝑠 𝑢𝑡𝑖𝑙𝑖𝑧𝑒𝑑 = 𝑃48 × 150,000 = P7,200,000 KEY POINTS: To arrive at the amount of overhead applied to the job through normal costing, the predetermined overhead rate is multiplied by the number of direct labor hours utilized in the production. References: Accountingverse. (n.d.). Types of costs (cost classifications). https://www.accountingverse.com/managerial-accounting/cost-concepts/types-of-costs.html Lalitha, R., & Rajasekaran, V. (2010). Costing accounting. Pearson. Nikhila, C. (n.d.). Costing: Meaning, aims and methods. https://www.businessmanagementideas.com/cost- accounting/costing-meaning-aims-and-methods-cost-accounting/7265 Rante, G. A. (2016). Cost accounting. Millenium Books, Inc. Swiftutors. (n.d.). Aims of costing. http://www.swiftutors.com/estimating/what-is-costing.php 01 Handout 1 *Property of STI  [email protected] Page 9 of 9