Understanding Basics

Providing Knowledge

  • Transferred-in costs

    Transferred-in costs Many Process-Costing systems have two or more departments or processes in the production cycle. As units move from one department to another, related costs are transferred monthly through journal entries. Transferred-in costs are also known as previous-department costs, which can be explained as costs which were incurred in previous departments and to be […]

  • Reciprocal Method

    Reciprocal Method This method is different from direct method and step down method. The reciprocal method allocates support department cost to operating departments by completely recognizing the shared services provided by all the support departments of the organization. We can explain this concept by taking an example of the organization set up, that is, the […]

  • Sales Variances

    Sales Variances Sales variance analysis helps management to determine the cause. it control the variances and it guides management to move towards a better, profitable and informed management of the resources. Now there are different types of variance analysis. Which help management on a different level in analyzing the sales situation. At level one, we […]

  • 5 Steps in Decision Making

    5 Steps in Decision Making Decision making process can be divided into many steps and processes but there are mainly five steps that are common or which include other steps. Step one includes obtaining information. This can be done while reviewing the past, present and expected future information. Each and every little detail is important […]

  • Budgeting Activity

    Budgeting Activity An organization budget can be broken down in to two main parts, one being the operating budget and the other being the financial budget. The operating budget mainly directs or we can say revolves around the revenue budget as everything is connected with the expected sales an organization is likely to have. Now the […]

  • ABC costing system

    Warning Signs That Suggest That ABC could help a Firm: A firm needs to have a refined costing system which can reduce broad averages for cost assigning purposes to cost objects and provide management with better and accurate information for decision making or cost controlling techniques. The firms need to observe the signs where ABC […]

  • Costing Approach

    Costing Approaches In costing for the direct and indirect expenses we need to assign the overall indirect costs to a specific job, so that the management can have a close estimate of the costs spent on various jobs throughout the year. The major purpose for this allocation of costs to specific jobs focuses pricing of […]

  • Contribution Margin vs. Gross Profit Comparative Statements

    Contribution Margin vs. Gross Profit Comparative Statements There are two ways to present the operations of the company in to statement forms. Both are these methods have their separate usage. Contribution margin approach is usually meant for interpretations of results and future planning by the internal management of the company, while the gross profit statement […]

  • What is Leadership

    Leadership There is huge difference between management and leadership. The managers has a responsibility to deal with the day to day task complexities but a leader deals with change and motivates his followers in such manner that all of them work as a unit in striving for organizational goals. In order to be successful in […]

  • Importance of communication

    Importance of communication in Organization The importance of communication process cannot be ignored in the success of an organization. The right use of medium in the communication along with the skills of the communicator is must for successful communication cycle. In organizations employees are constantly engaged in the different types of communications like horizontal, parallel […]