Cost concepts have developed according to the needs of accountants, economists, and
engineers. Accountants have defined cost as “an exchange price, a forgoing, a sacrifice
made to secure benefit. In financial accounting, the forgoing or sacrifice at date of acquisition is represented by a current or future diminution in cash or other assets.”1
Frequently the term cost is used synonymously with expense. However, an expense may be defined as a measured outflow of goods or services, which is matched with revenue to determine income, or as:
. . . the decrease in net assets as a result of the use of economic services in the creation
Cost concepts have developed according to the needs of accountants, economists, andengineers. Accountants have defined cost as “an exchange price, a forgoing, a sacrificemade to secure benefit. In financial accounting, the forgoing or sacrifice at date of acquisition is represented by a current or future diminution in cash or other assets.”1 Frequently the term cost is used synonymously with expense. However, an expense may be defined as a measured outflow of goods or services, which is matched with revenue to determine income, or as: . . . the decrease in net assets as a result of the use of economic services in the creation
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