The resource expenses in the left-hand side of Figure 5
were incurred during the historical time period. The
capacity for which these expenses were incurred was supplied.
Then it was either (1) unused as idle or protective
capacity or (2) the expenses were used to make products,
to deliver customer services, or to sustain the organization
internally. This is the cost reporting and analysis component
from Figure 4 that calculates output costs. The
money was spent, and costing tells where it was used.
This is the descriptive view of costs. Accountants refer to
it as full absorption costing when all the expenses for a
past time period are traced to outputs. It traces expenses