imputed cost

Author Topic: imputed cost  (Read 1051 times)

Offline mohsina

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imputed cost
« on: July 29, 2013, 04:58:58 PM »
Imputed costs are not actually incurred in some transactions but which are relevant to the decision as they part into a particular situation.This cost doesn’t enter into traditional accounting system but they are being related with economic reality, help in making better decision.

For example,  The owner of a house ha not to pay rent but it should take into consideration in making decision, otherwise cost will be understated.

Offline ummekulsum

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Re: imputed cost
« Reply #1 on: July 30, 2013, 03:32:14 PM »
So, it means whenever it is relevant then calculate otherwise not .

Offline mohsina

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Re: imputed cost
« Reply #2 on: August 01, 2013, 12:31:50 PM »
yes imputed cost is a relevant cost and considered for decision making purpose.

Offline munna99185

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Re: imputed cost
« Reply #3 on: September 07, 2013, 01:11:17 PM »
Imputed costs consist of the opportunity costs of time and capital that the manager has invested in producing the given quantity of production and the opportunity costs of making a particular choice among the alternatives being considered.

Source: Barron's Accounting Dictionary


Sayed Farrukh Ahmed
Assistant Professor
Faculty of Business & Economics
Daffodil International University