ECONOMICS

Detailed explanation-1: -A cost object is a term used primarily in cost accounting to describe something to which costs are assigned. Common examples of cost objects are: product lines, geographic territories, customers, departments or anything else for which management would like to quantify cost.

Detailed explanation-2: -Cost allocation is the process of identifying and assigning costs to the cost objects in your business, such as products, a project, or even an entire department or individual company branch.

Detailed explanation-3: -The three types of cost objects are output-related, operational, and business relationship-based.

Detailed explanation-4: -A cost object can be within a company, such as a department, machining operation, production line, or process. For example, you could track the cost of designing a new product, or a customer service call, or of reworking a returned product.

Detailed explanation-5: -What is a Cost Object? A cost object is an item for which a cost is compiled. For example, this can be a product, product line, service, project, customer, distribution channel, or activity. Cost objects are used in activity-based costing analyses as the focal point of cost accumulations.