Accounting Practices

When you are dealing with the accounting practices that pertain to measuring costs, it is very important to have some idea of the types of costs you will run accross.

1. Direct Costs: These are costs that are directly related to your product. Ex: If you have a automobile that is being produced the stering wheal, the tires and the radio.
   
2. Indirect Costs: Indirect cost are those that deal directly with the product but not any product in particular. Such as, if you have employees who build the cars they are directly responsible but not responsible completely with any one product or in this case car.
   
3. Fixed Costs: These are the costs that are always the same or close to the same amount taken out every month. These are normal monthly expenses that come to your business whether you make a sale or not.
   
4. Variable Costs: These are costs that increase or decrease with the volume of sales that you have.
   
5. Relevant Costs: These are costs that are needed when you take a different stategic move. If you decide you want to produce more cars and the tires go up in price then then that cost is relevant to your production.
   
6. Irrelevant Costs: These can be costs that decide on a future couse of action and are disregarded until that time comes as they may make you make mistakes in the here and now. Or they may be some cost that happened in the past and now are irrelevant cause that money is now gone.

These are some of the different types of Costs you will incur throughout the course of your business.

One of the most important accounting practices your company accountant is responsible for is measuring costs. The costs are very important to how your business is managed and it makes all the difference in the world to your company's ultimate bottom line.

If your company is in the business of making sales you will need an idea of the costs of making your product and you should have a method for any indirect production cost you may have as well. You may wan to check with GAAP (generally accepted accounting principles) to get the specific rules and regulations for measuring costs.

Here is a list of some of the costs your accounting must meaure:

• departmental needs
• supply costs
• retirement plans
• advertising
• marketing
• restructuring your company
• restructuring
• recalling products
• and many more

When a corporation changes their information or hides their facts in order to give the impression of financial health, it is called corporate fraud. When this is done to look as though they are successful to the shareholders, it is called shareholder fraud. This fraud scheme can be done by a few individuals within the corporation or it can be a far reaching scheme committed by many participants. Some of the head managers may change financial accounting information or may even disquise spending that is inappropriate. Fraudulent accounting practices can be devistating to shareholders and employess who may have invested in the company.

There have been a few corporate scandals that have rocked the fabric of our financial society and created chaos for people concerned with their personal finances.

Here are a few such financial scandals: