Accounting costs

О том, что такое издержки, рассказывает economic theory. Mainly, this is the cost of the enterprise to manufacture products. These costs involve the acquisition of any resources. In fact, these are the payments that each organization must pay to household resources or other firms.

There are different types of production costs. In particular, they distinguish: alternative, variable, transaction, permanent, economic costs and costs of missed opportunities.

There are also accounting costs.They represent payments for resources to third-party suppliers. Simply put, accounting costs are external costs. They include the monetary costs that are required to implement the production process. In particular, they include rent, raw materials, depreciation, wages, taxes, credit interest, administrative and trade expenses, and so on. The total amount of all these expenses forms the gross production costs.

Resources used in the production of services andgoods, have their value. It is expressed in monetary form. Thus, all payments are reflected in accounting documents. In accordance with this, the method of estimating costs is named. The costs estimated using the accounting method are called accounting costs.

Allocate the main articles on which the cost estimate is carried out. Among them it should be noted:

1. Material costs. This article includes the costs for fuel, raw materials, energy, as well as the cost of semi-finished products, components and other.
2. Wages. This includes the remuneration of employees and other deductions, which are provided for in the employment contract.
3. Deductions for social needs.This category includes payments, which are established by the norms of the legislation. They are directed to various funds (social insurance, employment promotion, pension and others).
4. Amortization. These deductions are made for the deterioration of the building, equipment.
5. Other expenses. This category includes payments on commissions to the bank for bank and cash services, lease payments, fees, taxes, payment for services and works of third-party firms, credit interest.

Accounting costs aimed at ensuring production and subsequent implementation are formed in accordance with the norms of the relevant Regulations, in which the composition of expenses is characterized.

It should be noted that implementationthe activity of the enterprise on the market also implies other, larger costs, which are associated with an expanded and simple production. Such costs are called entrepreneurial costs. Essentially, business expenses form the price of the offer. These costs include:

1. Accounting costs.
2. VAT (if it is charged over the value) and excises (in the case when the product is excisable).
3. Normal entrepreneurial income.
4. Customs duties on exported products (if foreign economic activity is carried out).
5. Imputed (alternative) expenses. In this case we are talking about the costs associated with missed opportunities for the best use of company resources.

When making economic decisions, consideringlimited resources, an economic entity must make a choice between alternative methods of using them. Thus, all costs taken into account in making decisions can be considered as alternative costs. If we consider these costs from the perspective of the enterprise, then they have an internal (implicit) and an external (explicit) nature. Accounting costs include only explicit costs.