Introduction: The Strategic Role of Costing
Beyond Bean Counting: Costing as a Competitive Advantage in the Modern Enterprise
Objectives of Cost Accounting
Ascertainment, Control, and Decision Making
Cost vs Financial vs Management
Key Differences and Interrelationships
The Cost Accountant's Role
Modern Organization and Strategy
View Complete Introduction Outline →
0.4 Core Principles and Concepts of the Costing Framework
0.5 The Role of the Cost Accountant in the Modern Organization
0.6 How to Use This Book: A Roadmap for Students and Professionals
0.7 The Digital Transformation of Costing: ERP, AI, and Automation
0.8 Running Case Study: Introducing "VoltRide Electric Bikes"
Section 1: The Framework
Foundational Concepts and Cost Behavior
Chapter 1: Understanding and Classifying Costs
1.1 Cost Terminology and Concepts
- Definition of Cost, Cost Object, Cost Unit, Cost Center
- The Elements of Cost: Material, Labour, and Expenses
- Cost Ascertainment vs. Cost Estimation
1.2 Classification by Nature and Function
- Materials, Labour, and Overheads
- Production, Administration, Selling & Distribution, R&D
- Direct vs. Indirect Costs
- Product vs. Period Costs
1.3 Classification for Decision Making
- Fixed, Variable, and Semi-Variable Costs
- Controllable vs. Non-Controllable Costs
- Relevant vs. Irrelevant Costs
- Opportunity Costs and Sunk Costs
1.4 Classification for Inventory Valuation
- Job Costing vs. Process Costing
- Absorption Costing vs. Marginal Costing
- Standard Costing Overview
+ 4 more topics (1.5-1.8 including Cost Units, Cost Centers, Profit Centers, and Investment Centers)
Chapter 2: Analyzing Cost Behavior
2.1 Fixed, Variable, and Mixed Costs
- Characteristics of Fixed Costs
- Behavior of Variable Costs
- Semi-Variable and Step Costs
- The Relevant Range Concept
2.2 Methods for Separating Mixed Costs
- High-Low Method: Calculation and Limitations
- Scattergraph Method: Visual Analysis
- Regression Analysis: Simple and Multiple
- Engineering Analysis and Account Analysis
2.3 Advanced Cost Behavior Models
- Learning Curve Theory
- Experience Curve Effects
- Non-Linear Cost Functions
- Digital Age Cost Behavior Patterns
Chapter 3: Cost Coding and Accounting Systems
3.1 Designing Cost Coding Systems
- The Chart of Accounts for Costing
- Hierarchical vs. Block Coding Structures
- Integration with ERP Systems (SAP, Oracle)
3.2 Cost Accounting System Architecture
- Integrated vs. Interlocking Systems
- Cost Ledgers and Control Accounts
- Reconciliation of Cost and Financial Accounts
- Automated Data Capture: IoT and RFID
Chapter 4: Digital Transformation in Costing
4.1 Costing in the ERP Era
- Data Flow from Shop Floor to Ledger
- Real-time Cost Tracking
- Integration with Supply Chain Systems
4.2 Automated Data Capture Technologies
- IoT Sensors for Material Tracking
- RFID for Inventory Management
- AI-powered Labor Tracking
- Blockchain for Cost Verification
Section 2: The Mechanics
Capturing Costs: Materials, Labour, and Overheads
Chapter 5: Material Costing and Control
• Procurement and Inventory Systems
• EOQ, JIT, and Stock Control Levels
• FIFO, LIFO, Weighted Average
• ABC Analysis and Material Losses
+ 8 detailed subtopics
Chapter 6: Labour Costing and Control
• Direct vs. Indirect Labour
• Remuneration and Incentive Schemes
• Halsey, Rowan, Taylor Plans
• Idle Time, Overtime, Labour Turnover
+ 7 detailed subtopics
Chapter 7: Overhead Costing and Allocation
• Allocation, Apportionment, Absorption
• Primary and Secondary Distribution
• Overhead Absorption Rates
• Under/Over-absorption
+ 6 detailed subtopics
Section 3: The Allocation Revolution
Traditional Overheads vs. Activity-Based Costing (Side-by-Side)
7 Traditional Overhead Allocation
- • Volume-based allocation (Labor/Machine Hours)
- • Plant-wide vs. Departmental Rates
- • Limitations and Distortions
- • When Traditional Costing Still Works
8 Activity-Based Costing (ABC)
- • Cost Pools, Cost Drivers, Activities
- • Cost Hierarchy: Unit, Batch, Product, Facility
- • Implementing ABC: Step-by-Step
- • Time-Driven ABC (TDABC)
⚡ Comparative Analysis: Traditional vs. ABC on the same company data (VoltRide Case Study)
Section 4: Costing Methods (Job, Process, Service, Contract)
Section 5: Planning, Control & Performance (Ch 13-16)
Section 6: Strategic Cost Management (Ch 17-20)
Section 7: The Future of Costing (Ch 21-22)
Chapter 21: Digital Transformation & AI in Costing
- • Big Data Analytics for Cost Prediction
- • Machine Learning in Cost Estimation
- • AI-driven Variance Analysis
- • Blockchain for Transparent Costing
- • Real-time Dashboards and Visualization
Chapter 22: ESG, Sustainability & Crisis Costing
- • Environmental Cost Accounting
- • Carbon Costing and Carbon Credits
- • Social Costing and ESG Reporting
- • Costing in Inflationary Environments
- • Resilience Costing vs. Lean Costing
- • Supply Chain Disruption Costing
Running Case Study: "VoltRide Electric Bikes"
Follow one fictional company through every chapter—see how the same data looks under Job Costing, ABC, Throughput Accounting, and more. Practical application of every concept.
⚡ The Great Costing Debate
A unique "Conflict Chapter" that pits Traditional Costing against Throughput Accounting (Theory of Constraints).
"High inventory absorbs overheads, improves unit cost, and looks good on financial statements."
"Inventory is a trap—it ties up cash and hides inefficiencies. Focus on throughput, not cost absorption."
This intellectual conflict runs throughout the book, challenging readers to think critically.
📚 Appendices & Reference
Each chapter will be available separately in A4 format for easy printing and study.