GFEBS L230E Cost Management Process Overview with complete solution
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Course
GFEBS
Institution
GFEBS
GFEBS L230E Cost Management Process Overview with complete solution
Direct Cost
A cost such as labor, materials, or supplies that can be traced directly to producing a specific output of an organization, product, and service
Indirect Cost
A cost that cannot be traced directly to a specific or...
GFEBS L230E Cost Management Process Overview with
complete solution
Direct Cost
A cost such as labor, materials, or supplies that can be traced directly to producing a
specific output of an organization, product, and service
Indirect Cost
A cost that cannot be traced directly to a specific organization, product, and/or service
output They often are allocated on a predetermined basis and generally are
synonymous with overhead costs such as general and administrative expenses.
Funded Cost
The value of goods or services received because of an obligation of funds by the
organization performing the work
Unfunded Cost
A cost that is financed by another organization's or activity's appropriations.
Variable cost
A cost that changes with a change in output
fixed cost
A cost that remains the same regardless of a change in output
sunk cost
A cost incurred in the past that will not be affected by any present or future decision
incremental cost
The increase or decrease in cost that would result from a decision to increase or
decrease output levels
avoidable cost
A cost incurred on an object that will no longer be incurred due to a decision to change
the output.
unavoidable cost
A cost incurred on an object that will be incurred regardless of the decision to change
Activity Type
An Activity Type is the cost master data that represents a group of resources within a
Cost Center. These resource groups have capacity and a unit of measure such as:
labor hours, machine hours, square footage, etc. Activity Types are used to produce the
products and services of the organization.
Cost Center
A Cost Center is a responsibility center on which costs are incurred. It has an
operational manager who is accountable for the resources consumed to produce the
cost center's output.
Project
A Project is an object used to plan, collect, monitor, and control costs for large scale
time-based events in Project Systems, when extensive scheduling and resource
management capabilities are required. Projects have definite start and end dates
WBS
A WBS element is an activity within the Project used to plan and update cost data.
Some examples of WBS Elements are: tasks, partial tasks, and work packages
, Order
Orders are cost objects used to plan, collect, monitor, and settle the costs of jobs and
tasks
Internal Order
An object used to track costs and revenues (in some cases) associated with internal
jobs and tasks. Internal Orders are often used to monitor the costs related to shorter-
term projects or those individual services offered by an organization.
Work Order
A Work Order is a specific task performed on a demand or preventative basis. Work
Orders reside in the Plant Maintenance Module in GFEBS. Work Orders are task-driven
and specific in nature.
Business Process
is a cost object used to capture costs of cross-functional Cost Center activities.
Business Processes are the "work" being performed by the Cost Center and Activity
Types.
Statistical Key Figure
is a unit of measure, including quantity or time, by which costs are reported. For
example, the number of people (headcount) served at a meal in a dining facility.
Cost Management Process
four sub-processes that interact and affect one another.
The sub-processes are:
- Cost Planning
- Cost Accounting
- Cost Analysis
- Cost Controlling
Cost Planning
Set Cost Targets and Efficiency Goals.
Compute Standard Rates
Cost Planning allows managers to plot out the expected costs to accomplish their
assigned mission for the coming year
Cost Accounting
Captures and validates data.
Provides accurate, timely, and relevant data.
Connects operational output/performance data to financial data. Allocates overhead
Cost accounting covers the activities of capturing and collecting primary costs and
assigning secondary costs. All primary costs are collected in cost objects as a result of
a transaction performed in a GFEBS module.
Assignment
The establishment of a relationship between a sending cost object and a receiving cost
object based on a quantity, with a rate for valuation being consumed by the receiver.
Allocation
The establishment of a relationship between a sending cost object to one or more
receiving cost object(s) based on a % (even if a quantity is used to generate a %, e.g.,
number of FTEs).
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