Account Analysis


DEFINITION of 'Account Analysis'

1. In cost accounting, this is a way for an accountant to analyze and measure the cost behavior of a firm. The process involves examining cost drivers and classifying them as either fixed or variable costs. The cost accountant then uses the company's data to figure out the estimated variable cost per cost-driver unit or fixed cost per period.

2. In banking, it is a periodic statement outlining the banking services provided to a firm. The statement is usually provided monthly and involves displaying all pertinent data, including the company's average daily balance and charges that the company incurs from the bank.

BREAKING DOWN 'Account Analysis'

1. In accounting, account analysis is quite complex and involves in-depth understanding of both the data and the company. It is usually performed by an experienced cost accountant, possibly with the help of one of the company's managers, who deals closely with the company's costs.

2. In banking, you can think about account analysis as similar to the statements you receive for your personal bank accounts. Since it is for a company account, however, it is much more detailed and on a larger scale.

  1. Descriptive Statement

    A bank statement that lists deposits, withdrawals, fees, etc. ...
  2. Accounting Method

    The method by which income and expenses are reported for taxation ...
  3. Fixed Cost

    A cost that does not change with an increase or decrease in the ...
  4. Variable Cost

    A corporate expense that varies with production output. Variable ...
  5. Accountant

    A professional person who performs accounting functions such ...
  6. Generally Accepted Accounting Principles ...

    The common set of accounting principles, standards and procedures ...
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  2. Do dividends affect working capital?

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  3. Do prepayments provide working capital?

    Prepayments, or prepaid expenses, are typically included in the current assets on a company's balance sheet, as they represent ... Read Full Answer >>
  4. Does working capital include salaries?

    A company accrues unpaid salaries on its balance sheet as part of accounts payable, which is a current liability account, ... Read Full Answer >>
  5. What is a profit and loss (P&L) statement and why do companies publish them?

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