Answered: Explain the cost principle

Business

Accounting

Explain the cost principle

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 6Q: Explain conversion costs using an example.

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Explain the cost principle

Expert Solution

Step 1

Accounting Principles:

The term "accounting principles" refers to the standards, guidelines or methods of reporting the accounting information in the financial statements of the companies.

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