2.2. Write Short Notes on
a) 1) Operating cost Account
b) 2) Reconciliation of Cost and Financial Accounts.
c) 3) Contract Costing.
Answers
Answer:
Operating costs are expenses associated with the maintenance and administration of a business on a day-to-day basis. ... The operating cost is deducted from revenue to arrive at operating income and is reflected on a company's income statement.
Reconciliation Statement:
Reconciliation means tallying the profits/losses reveled by both set of accounts. Reconciliation Statement is a statement which shows the reasons for the differences between profit and losses as shown by the cost accounts with that of the profits/losses as shown by the financial accounts.
Contract Costing...
Contract costing is the tracking of costs associated with a specific contract with a customer. For example, a company bids for a large construction project with a prospective customer, and the two parties agree in a contract for a certain type of reimbursement to the company. ... Cost plus...
Answer:
The operating costing gives more emphasis on providing services rather than the cost of manufacturing an article. The services provided may be for sale to the general public or they may be provided within an organization. The operating costing is also called as service costing, period costing or terminal costing
Reconciliation of Cost and Financial Accounts is process to find all the reasons behind disagreement in profit which is calculated as per cost accounts and as per financial accounts. There are lots of items which are shown in the profit and loss account only when we make it as per financial accounting rules.
Contract costing is the method of costing which is applied in a business where separate contracts of non-repetitive nature are undertaken. According to Sharie, “Contract or terminal cost accounts are applicable to a concern which makes specific contracts and requires to know the cost of each.”
Explanation:
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