ACC 252 Lecture Notes - Lecture 1: Management Accounting, Variable Cost, Income Statement

• School: Syracuse University
• Department: Accounting
• Course: ACC 252
• Professor: Zadzilka

Document Summary

Cost = amount given up to acquire something. Necessary element of long term success for an organization. Management needs to understand the nature of the different costs so they can be managed correctly. A single item can be classified in many different ways. Appropriate way -> depends on the type of analysis being performed. Direct materials + direct labor + manufacturing overhead = the product. Raw materials that become an integral part of the product. Can be conveniently be traced directly to the product. If it"s too small to be traced, it"s an indirect cost. Ex: thread used in a factory, ink used in textbooks -> a detail so minute, it takes too much work to trace it directly to products. Labor costs that can be easily traced to individual units of a product. Ex: wages paid to car assembly workers. Manufacturing costs that can"t be traced directly to specific units produces.