COST ACCOUNTING

Current Ratio - meaning and formula.

Current Ratio – meaning and formula.

The most widely used measure of the liquid position of an enterprise is the current ratio, that is, the ratio of the firm’s current assets to current liabilities.

It is calculated by dividing current assets by current liabilities:

Current Ratio = current asset/current liabilities

The current assets of a firm represent those assets which can be in the ordinary course … Read the rest

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3 limitations of job costing.

Job costing, generally, means a specific accounting methodology used to track the expense of creating a unique product. Due to the fact that certain projects, such as construction, require different operations, accountants use this methodology to trace the expenses of each job in order to use this information for analysis and tax needs. Job costing forms have … Read the rest

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Application of batch costing.

Batch costing is another form of job costing which is adopted in case of manufacturing of a large number of components of machines or of other articles. Since a large number of them are manufactured together and pass through the same process of manufacture, it is convenient to collect their cost of manufacture together.



Batch … Read the rest