After studying this chapter, you will be able to: 1. Define the term cost object and give examples of cost objects relevant to different types of decisions 2. Describe several degrees of cost traceability implied by the terms direct cost and indirect COM 3. State the considerations involved in creating a cost accounting information system. 4. Explain why increased attention is being given to nonfinancial performance measures. 5. Name and describe the ways costs are classified Cost accounting was once considered to apply only to manufacturing. Today, however. every type and size of organization benefits from the use of cost accounting. For example, cost accounting is used by financial institutions, transportation companies, professional service firms, hospitals, churches, schools, colleges, universities, and governmental units. as well as the marketing and administrative activities of manufacturing firms Chapter 1 introduced cost accounting as part of the management function and described influences on cost accounting from internal and external environments. This chapter presents the fundamental