ECONOMICS

Detailed explanation-1: -Cost ascertainment is the process of determining costs on the basis of actual data. Hence, the computation of historical cost is cost ascertainment while the computation of future costs is cost estimation. Both cost estimation and cost ascertainment are interrelated and are of immense use to the management.

Detailed explanation-2: -] Historical Absorption Costing: It’s the ascertainment of costs after they have been incurring. It defines as the practice of charging all costs, both variable and fixed, to operations, process or products. It also knows as traditional costing.

Detailed explanation-3: -What Is Historical Cost? Historical cost is the price paid for an asset when it was purchased. Historical cost is a fundamental basis in accounting, as it is often used in the reporting for fixed assets. It is also used to determine the basis of potential gains and losses on the disposal of fixed assets.

Detailed explanation-4: -Historical cost is used in accounting to record an asset’s original cost and allow for adjustments based on a change in value over time. This idea is also called the cost principle, and it is widely recognized in accounting.