What you can learn about cost accounting

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Students interested in earning an accounting degree online can expect to cover a wide variety of topics central to the profession throughout the Bachelor of Science in Accounting curriculum at the University of Alabama at Birmingham. The curriculum includes everything from the most basic principles of accounting to high-level courses focusing on specific skills accountants need to prosper in certain roles, as well as introductions to a number of more general business processes. As part of the Accounting Core, program participants must complete the Cost Accounting course. This class provides vital information about cost determination, analysis, control, cost allocations, application of overhead, budgeting, and many other key components involved in this process. Let’s review the foundation of cost accounting as well as its applications in the modern economy.

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What is cost accounting?

Cost accounting focuses on the many actions taken around the cost of a business process or workflow, both in its individual components and overall. The goal of cost accounting is to find ways to provide more information about expectations versus results, reduce spending, and make operations more efficient without reducing effectiveness or output. There are innumerable ways that cost accounting can be applied in the modern economy, from cutting waste on a traditional factory production line to optimizing the structure and processes of a digital workflow. Cost accounting may involve taxes, tariffs and other financial considerations, but not always. Although certain industries, such as manufacturing, utilize cost accounting to an exceptional degree, it can be broadly applied in a wide range of industries.

While many forms of accounting are focused on compliance with tax law and similar considerations, cost accounting instead targets internal efficiency and performance improvement. For that reason, knowledge of widespread standards and rules is still important, but not the primary consideration involved in cost accounting activities. It is more important for cost accountants to be able to review relevant information, reliably and completely assess specific internal processes, and identify inefficiencies or opportunities to address.

What are the advantages of cost accounting?

Cost accounting focuses on a company’s budget and compares expected and actual costs within a single company’s unique environment. It provides an internal benefit in a way that tax accounting often doesn’t. One of the most notable benefits of cost accounting is that it’s adaptable and flexible. There are standards and best practices to follow, but they aren’t as rigid nor as omnipresent as those used in many other forms of accounting. Companies can therefore tailor their cost accounting efforts to provide the most relevant results.

Cost accounting gives companies a framework to drill down into the specific nature of their many operational expenses. From determining expected and actual costs to predicting fixed and variable costs, to identifying direct, indirect, sunk, controllable, and many other types of costs, this discipline provides invaluable context and specific information and recommendations that aren’t always apparent in tax accounting.

For students interested in pursuing cost accounting roles after graduation, this kind of flexibility in application on a company-by-company basis can be attractive. For those more predisposed to creative or context-dependent problem-solving roles, cost accounting can prove to be a good fit. The ability to specialize in specific types of cost accounting systems allows professionals to develop a specific set of skills in line with their strengths and interests.

In terms of day-to-day activities, cost accountants need the technical accounting and analysis competencies to handle ongoing work and special projects. They also must have robust communication abilities, as well as the talent to build and maintain effective professional relationships. Accurate analysis and development of recommendations is critical, but so is the skill to reliably and efficiently share information in the right context. Working independently at certain times, participating in group work, and shifting from one project to the next are also important skills to keep in mind.

The Cost Accounting course at UAB

Students in the accounting degree online program at the University of Alabama at Birmingham focus on cost accounting exclusively in the course of the same name. This in-depth learning opportunity provides initial exposure and additional context for the core topics that fall under the cost accounting umbrella. Cost determination, analysis, and control are all covered, as are overhead application, standard costs, job orders, byproduct costing, spoilage, quantitative techniques, and much more. Upon completing the course, program participants have a strong foundation in this aspect of the profession and can continue along an educational path that focuses on it or start seeking out entry-level roles.

Students pursuing an accounting degree online from UAB benefit from a high-quality education that follows a flexible, adaptive schedule. Program participants can easily incorporate learning, studying, project work and assessments into an existing schedule of personal and professional obligations. To learn more, get in touch with an enrollment advisor today.

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