Cost Units

Cost Accounting
The techniques used in collecting, processing, and presenting financial and quantitative data within an organization to ascertain the cost of cost centres and cost units and the various operations.
Cost Ascertainment
The process of determining the costs of the operations, processes, cost centres, and cost units within an organization.
Direct Labour
Direct Labour refers to the labor involved in the production of goods or services, specifically attributable to specific cost units such as products, services, or machinery usages.
Overhead Absorption
Overhead absorption, also known as overhead allocation, involves distributing indirect costs to different cost units or products. It's a crucial part of cost accounting, ensuring all production costs are appropriately assigned.
Percentage on Direct Material Cost
A basis used in absorption costing for absorbing the manufacturing overhead into the cost units produced. The formula used is: Overhead Absorption Rate = (Total Overhead / Total Direct Material Cost) * 100.
Production
Production refers to the processes and methods employed to transform inputs (like raw materials, labor, and machinery) into finished products or services. The volume of production can be quantified in units, direct labor hours, machine hours, or direct labor costs.
Rate Per Direct Labour Hour
A basis used in absorption costing for absorbing manufacturing overhead into the cost units produced. It is essential for allocating overhead costs accurately in a manufacturing environment.
Rate Per Machine Hour
Rate per machine hour is a basis used in absorption costing for absorbing manufacturing overhead into cost units produced, providing insights into the operational efficiency and cost management within a manufacturing setup.

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