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DIFFERENCE BETWEEN TIME RATE SYSTEM AND PIECE RATE SYSTEM BASIS OF DIFFERENCE TIME RATE SYSTEM PIECE RATE SYSTEM MEANING Time rate system is a method of wage payment to workers based on time spent by them for the production of output. Piece rate system is a method of wage payment to workers based on the…
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SYSTEM OF WAGE PAYMENT IN COST ACCOUNTING WAGES Before understanding system of wage payment in cost accounting, get to know What is Wage? A wage is monetary compensation paid by an employer to an employee in exchange for work done. Payment may be calculated as a fixed amount for each task completed or at an hourly or daily rate, or based…
IDLE TIME Idle time means the amount of time the workers remain idle in a normal working day. It is that time for which the employer pays, but from which he obtains no production. In other words, idle time is the difference between the time shown by the time card and job card. The idle…
OVERHEAD Overhead is the aggregate of indirect material costs, indirect labor costs and indirect expenses. These are those costs which cannot be allocated accurately but can be apportioned and absorbed to the cost centers or cost units. Overheads costs are also known as ‘ Supplementary costs’, ‘Non-productive costs’, ‘Indirect costs’ etc. ACCORDING TO BLOCKER AND…
STORE LEDGER Store ledger is maintained under Perpetual Inventory system by costing office and deals with the quantities and values of materials received, issued and balance in hand. It is an assemblage of cards or sheets, which are maintained to keep a record of quantity and cost of material received, transferred and remained in stock….
MEANING Bin card is the record maintained under the perpetual inventory system by the stores department and shows the quantities of materials received, issued and balance in hand after each receipt and issue. It is also known as stock card or bin tag. Bin Card helps to monitor the total inventory process. This card is…
PRICING OF MATERIALS Pricing of materials refers to valuation of materials issued by the stores department for the production process. Pricing of materials should be done by adopting the method which is suitable for nature of materials and business itself. The methods applied for pricing of materials are as follows: 1.COST PRICE METHOD Cost price…
MEANING Perpetual Inventory System refers to a system of maintaining such records as will reflect the receipts, issues and balance of all items of materials in store all the times. It is a material control technique. ACCORDING TO ICMA (Institute of Cost and Management Accountants), UK “Perpetual Inventory System is a system of records maintained…
MATERIAL CONTROL IN COST ACCOUNTING PDF Material control is a system which ensures the provision of the required quantity of materials of the required quality at the required time with the minimum amount of capital investment. It can be defined as safeguarding of company’s property in the form of inventory and maintaining it at the…
TYPES OF COST There are various types of cost which can be classified on various bases such as element, nature, variability or behavior, controllability etc. Cost refers to the expenditure incurred on producing the goods and services. It represents the sacrifice, foregoing or a release of something of value. ACCORDING TO ICMA (Institute of Cost…
