A ‘Cost Object,’ also known as a CO Account Assignment Object, in SAP denotes a unit to which you can assign objects. It is something like a repository in which you collect costs, and, if necessary, move the costs from one object to another. All the components of CO have their own cost objects such as cost centers, internal orders, etc.
The cost objects decide the nature of postings as to whether they are real postings or statistical postings. All the objects that are identified as statistical postings are not considered cost objects (for example, profit centers).
