What is current cost accounting?

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What is the difference between current cost accounting and historical cost accounting? Which one is used in financial reporting? Current cost incorporates movements in inflation right?

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score 0 · Answer 1 · 2012-12-02T19:57:32+00:00

Current cost accounting is an alternative to the historical cost accounting. It basically measures the assets at their replacement cost or how you would spend to replace it now. Currency cost accounting tries to take into account the effect of inflation which is particularly material in hyper-inflationary economies.