Cost accounting is the process of recording, analyzing, and allocating costs associated with producing goods or services. It helps businesses determine the total cost of production, including direct costs (like materials and labor) and indirect costs (like overhead). The goal is to track and control expenses to improve profitability and efficiency. Key methods in cost accounting include job order costing, process costing, and activity-based costing. By understanding cost behavior, businesses can make informed decisions on pricing, budgeting, and financial planning, ultimately enhancing cost control and decision-making processes.