What is a cost?

A cost is the value of a resource transformed, destroyed, sacrificed or forgone to achieve a specific objective.

While this definition is technically correct, it does not provide much practical guidance. Fortunately, since we are computing costs primarily for asset valuation, we can rely on financial accounting to determine what costs are. So what is a cost from the perspective of financial accounting? And what are the other definitions of costs you might consider when you use costing for other purposes than asset valuation? I will now address both questions.