Costing and accounting are two terms that are often used interchangeably, but they have different meanings and applications.
Costing refers to the process of determining the cost of producing a product or providing a service. It involves analyzing the various costs involved in the production process, such as direct materials, direct labor, and overhead costs, and calculating the total cost of producing the product or providing the service. Costing is usually use to determine the selling price of a product or service.
Cost accounting, on the other hand, is a system of accounting that is use to record, classify, and analyze the various costs associated with producing a product or providing a service. It involves collecting data on the costs incurred in the production process, and then analyzing and interpreting that data to provide information that is useful in making business decisions. It is use to monitor the cost of goods sold, the profitability of products, and the efficiency of the production process.
In summary, costing is the process of determining the cost of producing a product or providing a service, while accounting is a system of accounting used to record, classify, and analyze the various costs associated with producing a product or providing a service.
While both concepts are relate to the cost of production, cost accounting is a more comprehensive approach that involves the use of accounting techniques and methods to provide valuable insights into the cost structure of a business.
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