Original cost is the amount paid to acquire an asset at the time of purchase, including directly attributable costs where relevant. It forms the starting point for accounting measurement under the historical cost basis. Over time, the original cost may be adjusted through depreciation, amortization, or impairment, but the starting recorded cost remains important.
Owner’s Equity
Owner’s equity is the residual interest of the owner or shareholders in the business after deducting liabilities from assets. It includes capital introduced, retained...
Overhead
Overhead refers to indirect costs that support business operations but cannot be directly traced to a specific product or service. Examples include factory rent,...
Overapplied Overhead
Overapplied overhead occurs when the amount of overhead allocated to production is greater than the actual overhead incurred during the period. This means products...
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