Recent Articles

Cost Accounting

Cost accounting matches the respective detail costs to a job or function to help management determine performance. If properly enacted, the program provides a continuous positive feedback loop to maximize profits for the division or company.

Project Accounting Principles for Residential Contractors

04/04/2015

Almost every residential contractor I had as a client had no clue of their financial position as it related to any one of their residential contracts.  None of them knew whether the project was fully funded, over funded or unfunded at any point in [...]

House Flipping – Business Dynamics

02/26/2015

There is a lot of misinformation about flipping real estate on the internet and on television.  I’m mostly shocked by the lack of detailed information related to the entire cost of the project and the adjusted sales price.  I have yet to read a [...]

Project Accounting – Introduction and Value

10/17/2014

In the world of accounting, project accounting is a subset of financial accounting.  Many folks believe it is a form of cost accounting and it is not.  Cost accounting is more formally a function of manufacturing and deals with large quantities of [...]

Variable Costs

10/14/2014

Variable costs are those business related expenditures that vary in proportion to production.  The most common examples of variable costs include raw materials, labor, packaging and distribution expenses related to producing and delivering the [...]

Fixed Costs – Explanation and Examples

02/19/2014

‘Fixed costs’ is a business term used mostly in cost accounting.  It has several meanings based on its usage.  The most common definition associated with fixed costs is expenses that must be paid regardless of production or sales volume.  The [...]

Definition of Contribution Margin

04/06/2013

Contribution margin is a core business concept and is often used in cost accounting to identify the amount of financial contribution a sold product provides to the company.  Simply put, contribution margin is the sales price less the direct costs [...]
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