791:(also called externalities), in contrast, are the costs that people other than the buyer are forced to pay as a result of the transaction. The bearers of such costs can be either particular individuals or society at large. Note that external costs are often both non-monetary and problematic to quantify for comparison with monetary values. They include things like pollution, things that society will likely have to pay for in some way or at some time in the future, even so that are not included in transaction prices.
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that has been used up to produce something or deliver a service, and hence is not available for use anymore. In business, the cost may be one of acquisition, in which case the amount of money expended to acquire it is counted as cost. In this case, money is the input that is gone in order to acquire
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borne by those who are affected by the pollution or who value unpolluted air or water. Because the manufacturer does not pay for this external cost (the cost of emitting undesirable waste into the commons), and does not include this cost in the price of the car (a
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for the manufacturer (in some ways, normal profit can also be seen as a cost of production; see, e.g., Ison and Wall, 2007, p. 181). The polluted waters or polluted air also created as part of the process of producing the car is an
818:), they are said to be external to the market pricing mechanism. The air pollution from driving the car is also an externality produced by the car user in the process of using his good. The driver does not compensate for the
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is the value of the best alternative that was not chosen in order to pursue the current endeavor—i.e., what could have been accomplished with the resources expended in the undertaking. It represents opportunities forgone.
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In accounting, costs are the monetary value of expenditures for supplies, services, labor, products, equipment and other items purchased for use by a business or other accounting entity. It is the amount denoted on
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the thing. This acquisition cost may be the sum of the cost of production as incurred by the original producer, and further costs of transaction as incurred by the acquirer over and above the
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would include travel time, holiday pay, training costs, working clothes, social insurance, taxes on employment &c.
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for a new or existing company, product or project, planners typically make cost estimates in order to assess whether
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For example, the manufacturing cost of a car (i.e., the costs of buying inputs, land tax rates for the car plant,
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costs and charges related to workers. Manufacturing cost is divided into three broad categories:
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When a transaction takes place, it typically involves both private costs and external costs.
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expenses. Generally, non-manufacturing costs are further classified into two categories:
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Costs (pl.) are often further described based on their timing or their applicability.
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that is totaling up as a result of a process or as a differential for the result of a
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37:"Expensive" redirects here. For the song by Ty Dolla Sign featuring Nicki Minaj, see
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is where the price equals cost plus a percentage of overhead or profit margin. In
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1378:"Production Costs vs. Manufacturing Costs: What's the Difference?"
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1242:"Opportunity Cost: Definition, Calculation Formula, and Examples"
1201:. Upper Saddle River, New Jersey: Pearson Prentice Hall. p.
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is a term in networking to define the worthiness of a path, see
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1402:"Total manufacturing cost: What is it and how to calculate it"
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used without qualification often means opportunity cost.
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of products. Examples of manufacturing costs include
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804:of running the plant and labor costs) reflects the
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Money spent to produce or procure goods or services
895:{\displaystyle {\text{Profit = Revenues – Costs}}}
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797:are the sum of private costs and external costs.
668:. Hence cost is the metric used in the standard
905:Manufacturing costs vs. non-manufacturing costs
914:are those costs that are directly involved in
949:. Examples of such costs are salary of sales
761:Comparing private, external, and social costs
622:
8:
1452:"Nonmanufacturing overhead costs definition"
1364:"Revenue vs. Profit: What's the Difference?"
1010:. Unsourced material may be challenged and
330:International Financial Reporting Standards
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43:
1030:Learn how and when to remove this message
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878:for owner interest, as expressed by:
320:Generally-accepted auditing standards
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1008:adding citations to reliable sources
335:International Standards on Auditing
1123:Outline of industrial organization
25:
1292:"Private cost - Energy Education"
874:that cover all costs and leave a
656:More generalized in the field of
392:Notes to the financial statements
1048:genuine progress indicator (GPI)
980:
889:Profit = Revenues – Costs
852:/benefits will cover costs (see
340:Management Accounting Principles
63:
1197:Economics: Principles in Action
961:Selling and distribution costs.
1193:; Sheffrin, Steven M. (2003).
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315:Generally-accepted principles
1450:Bragg, Steven (2023-10-08).
939:Manufacturing overhead cost
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753:In theoretical economics,
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822:caused by using the car.
816:Kaldor–Hicks compensation
686:Types of accounting costs
184:Constant purchasing power
81:Constant purchasing power
712:standard cost accounting
515:Accounting organizations
503:People and organizations
1426:"2.3: Cost Terminology"
263:Amortization (business)
896:
743:, also referred to as
1165:is revenue minus the
927:Direct materials cost
897:
854:cost–benefit analysis
840:parametric estimating
387:Management discussion
32:Cost (disambiguation)
1272:on 29 September 2020
1004:improve this section
884:
820:environmental damage
675:applied to economic
354:Financial statements
307:Accounting standards
30:For other uses, see
1430:Business LibreTexts
911:Manufacturing costs
783:production function
580:Earnings management
550:Positive accounting
424:Double-entry system
414:Bank reconciliation
219:Revenue recognition
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1191:O'Sullivan, Arthur
1167:cost of goods sold
1133:Semi-variable cost
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868:business economics
860:during execution.
844:When developing a
555:Sarbanes–Oxley Act
490:Sarbanes–Oxley Act
419:Debits and credits
254:Cost of goods sold
209:Matching principle
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1459:. Retrieved
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1434:. Retrieved
1432:. 2021-02-27
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1409:. Retrieved
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1385:. Retrieved
1382:Investopedia
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1347:. Retrieved
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1323:. Retrieved
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1299:. Retrieved
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1274:. Retrieved
1270:the original
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1249:. Retrieved
1246:Investopedia
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1163:Gross profit
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1078:Average cost
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1002:Please help
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660:, cost is a
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520:Luca Pacioli
441: /
261: /
259:Depreciation
167:Key concepts
139:Governmental
1098:Direct cost
1093:Cost object
972:Other costs
955:advertising
771:social cost
767:Externality
533:Development
510:Accountants
406:Bookkeeping
325:Convergence
283:Liabilities
214:Materiality
102:Major types
1461:2024-01-30
1436:2024-01-30
1411:2024-01-30
1387:2024-01-30
1349:2024-01-30
1325:2024-01-30
1301:2024-01-30
1251:2024-01-30
1177:References
1138:Total cost
1103:Fixed cost
1088:Cost curve
735:cost basis
568:Misconduct
194:Fair value
144:Management
86:Management
57:Accounting
1061:Path cost
1020:June 2023
991:does not
951:personnel
733:or asset
708:sunk cost
677:processes
658:economics
590:Hollywood
470:Financial
372:Cash-flow
129:Financial
18:Expensive
1476:Category
1406:Advanced
1226:Reviso.
1071:See also
850:revenues
719:invoices
673:paradigm
670:modeling
666:decision
575:Creative
545:Research
475:Internal
462:Auditing
278:Goodwill
273:Expenses
124:Forensic
49:a series
47:Part of
1276:1 March
1065:Routing
1053:Labour
1012:removed
997:sources
947:product
876:surplus
731:expense
721:as the
540:History
434:Journal
293:Revenue
179:Accrual
1209:
967:costs.
838:, and
710:, and
662:metric
485:Report
439:Ledger
382:Income
377:Equity
288:Profit
268:Equity
244:Assets
149:Social
114:Budget
1482:Costs
1150:Notes
1055:costs
723:price
651:price
646:money
480:Firms
109:Audit
1278:2018
1207:ISBN
995:any
993:cite
953:and
769:and
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642:Cost
249:Cash
134:Fund
119:Cost
1006:by
154:Tax
91:Tax
1478::
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