Cost - Types of Accounting Costs

Types of Accounting Costs

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 invoices as the price and recorded in bookkeeping records as an expense or asset cost basis.

Opportunity cost, also referred to as economic cost the cost of using resources for a certain purpose, measured by the benefit given up by not using them in their best alternative use —i.e., you spend time and money going to a movie, you cannot spend that time at home reading a book, and you can't spend the money on something else. In theoretical economics, cost used without qualification often means opportunity cost.

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