Cost Concept Homework Help

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What is cost concept?

Cost concept is also known as cost principle of accounting. According to it, the assets and liabilities should be arranged into accounting records as per their historical values. The historical value is the original value at which the asset was purchased, and is usually different from the current market value of the asset. In our Cost concept homework help article, we define the importance of it in brief.

Importance of Cost concept

As per our Cost concept homework help article writers, this concept is considered to be reliable along with consistent and verifiable. If any other cost parameter other than cost concept is adopted, it may be considered as a serious issue with accounting. If any firm prepare their financial statement more than once in a year, the Cost concept homework help phenomenon is not for them.
As our Cost concept homework help article, if any firm uses the current market value despite of the historical cost, each and every member of the accounting department will provide various values for each asset of the company.

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Example for Cost concept homework help

1. A company in America made a building at a cost of $45,000 in the year 2009 but after 3 years the fair market value of that building crosses $60,000. Anyway, the building still stands on its historical cost in the balance sheet.

2. Chennai trading company exchanged 500 units of an item at a cost of Rs. 100 per unit. The current price of the inventory goes beyond Rs. 150. The company is supposed to report the inventory purchase at Rs. 100 in their annual report.

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