cost object


cost object
Any item for which a separate measurement of costs is desired. This may be a product, a service, a customer, or a specific operation associated with any of these (e.g., designing a new product, processing a mortgage application, making a telephone call to a customer). The number of cost objects identified and the frequency of measuring the costs will vary between organizations; a product cost will normally be calculated on a weekly or monthly basis, whereas the cost of processing a mortgage application may only be calculated on an annual basis.

Accounting dictionary. 2014.