Which of the following can be considered cost objects in managerial accounting?

• A. Only financial statements
• B. Products, departments, and customers
• C. Only cash transactions
• D. Only external auditors

Answer: (B)

Verified step by step guidance

1. Understand the concept of a cost object: In managerial accounting, a cost object is anything for which costs are measured and assigned. This can include products, services, projects, customers, or departments.
2. Analyze the options provided in the question: Evaluate each option to determine if it fits the definition of a cost object. For example, financial statements and external auditors are not typically considered cost objects because they are not directly tied to the measurement or assignment of costs.
3. Focus on the correct answer: Products, departments, and customers are valid cost objects because costs can be tracked and assigned to them for decision-making purposes.
4. Eliminate incorrect options: Exclude options like 'Only financial statements' and 'Only cash transactions' as they do not align with the definition of cost objects in managerial accounting.
5. Conclude with the correct understanding: Managerial accounting uses cost objects like products, departments, and customers to analyze and allocate costs effectively for internal decision-making.