Cost Structure of a Shipping Company

Page Count: 23
Length: 5739 Words


This chapter is concerned with the concepts and theory that underlie the operating cost structure in ocean shipping companies. The concepts and theories considered in this chapter apply to both the classification of operating costs and to those factors which may be reasonably expected to affect the level of such costs.

Accounting for Operating Costs in Ocean Shipping Companies

The cost structure within a firm is typically a function of the cost accounting process. Cost accounting generally is a part of managerial accounting.1 Where financial accounting is concerned with recording actual financial transactions, managerial accounting is concerned with the discovery of relationships in financial data which enhance managerial decisionmaking.2

Eight factors and characteristics differentiate traditional managerial accounting from financial accounting. These factors and characteristics are as follows.3

1. Managerial accounting focuses on providing data for the internal use of an organizations managers, while financial accounting focuses on providing data for external uses by investors and creditors.

1R. H. Garrison, Managerial Accounting, 5th ed. (Dallas: Business Publications, Inc., 1991), 11.

2. Managerial accounting emphasizes the future, while financial accounting emphasizes the current period and the past.

Read the full essay by joining our writing community - over 32,000 professional essays and term papers. Access this essay now!

Category: Economics - C

Some common topics found in the essays are:

Fess Weygant, Fairplay Publications, Classifications Activityrelated, Management Accounting, Publications Inc, Macmillan Publishing, Public Policy, Book Company, Shipping Companies, Requirement/Profit Contribution57, standard costs, ocean shipping, cost accounting, managerial accounting, operating costs, ocean shipping companies, shipping companies, financial accounting, standard cost, cost systems, variable costing, standard cost systems, variable costing concept, cost accounting process, limits established management,

Click Here to Get Instant Access to over 32,000 Professionally Written Papers!!!