This time we will discuss the Summary and Important Terms in Cost Accounting from understanding to history, happy reading …
Table of contents :
- Definition of Accounting
- According to the AICPA – American Institute of Certified Public Accountans
- History of Accounting Development
- Accounting principles / basic accounting concepts
- Funding principle
- The company
- Field – Field of Accounting
- Terms in Cost Accounting
- Accounting (accounting)
- Economic unity (economic entity)
- Cost accounting
- Financial accounting
- Management accounting
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Definition of Accounting
According to the AICPA – American Institute of Certified Public Accountans
An art of recording there is a grouping and summarizing in a way that also means or is expressed in terms of money value, all transactions or events that are at least financial in nature and then interpret the results.
History of Accounting Development
- Since humans recognize money as a means of buying / selling events that will be related to finance will also experience development
- The oldest records are from the times of ancient Egypt (4000 BC), Babylonian (3600 BC) or also Ancient Greece
- Complete recording & will also use Arabic decimal numbers and the discovery of a bookkeeping system
- In 1494 a book of pair bookkeeping by Luca Pacioli with the title “Suma De Aritmatika, Geomatrika Proportioni et Propotionalita” was published, which tells of an exact science lesson, in which there is a bookkeeping chapter for an entrepreneur entitled “Tractatus De Computis Et Sciprotis”. disseminated into the Dutch system (Continental System), British and American systems (Anglo Saxon System) This accounting system will be in pairs known as accounting in America which is often known as Accounting
Accounting principles / basic accounting concepts
- Cash Basis: Paid in cash or cash
- Accrual Basis: Money going in and out that is recorded (already and some that are not but certain or receivable)
- Principle of business unity: Companies must be considered as independent bodies so that personal assets must be separated from assets
Also Read: Cost Classification
- Continuity / going concern principle: That the company will be established for an unlimited period of time
- Cost principle: that all assets or fixed assets will be valued at the same amount as the assets are ready to be used, for example: price of goods + installation price
Field – Field of Accounting
- Financial accounting: Focuses on a process of recording to presentation of reports for an external party company
- Management accounting: For internal companies, to be able to develop and also to be able to make decisions
- Audit accounting / auditing: Specifically on independent accounting records
- Cost accounting: Relates to planning, determining, and controlling production costs
- Budget accounting: To be able to plan company expenses and will also compare it with actual expenses
- Tax accounting: To be able to calculate taxes
- Special accounting system: Planning for the implementation of procedures for the collection of financial data to facilitate internal control
- Government accounting: Specifically for the presentation of transaction reports to be carried out by the government
- Accounting education: Relates to the development and dissemination of accounting
Terms in Cost Accounting
Is an activity or service that functions to provide quantitative information, especially financial in nature, regarding economic units
certain matters to interested parties, to be used as material for consideration in making economic decisions.
Economic unity (economic entity)
can mean a legal entity (legal entity) such as a limited liability company, partnership or also an individual business, but it can also mean a smaller entity in an organization such as divisions, departments and so on.
a special field of accounting which will be related primarily to accumulation and cost analysis to determine the cost of products that have been produced, and to assist management in planning, controlling, or making decisions.
a special field of accounting that deals with the preparation of financial statements which will primarily be addressed to various external users or parties outside the company, as well as information which will cover a company as a whole.
This special field of accounting, which is primarily concerned with financial reporting, can be used by internal users or parties within the company, in this case where the management of all levels of the company organization is involved.