Define Accounting and Its Role in Business

question 30

Essay

Define accounting and its role in business.

---

Definitions:

Idle Capacity

Unused or underused production capability within a manufacturing facility, often resulting in inefficiency and lost potential revenue.

Full (Absorption) Cost

The total cost of a product that includes all direct and indirect costs, such as raw materials, labor, and overhead, required for its production.

Transfer Price

The price charged for goods or services transferred between divisions or units of the same company.

Additional Parts

Extra components or pieces supplied beyond the original requirements, often used for repairs, replacements, or enhancements.