Purpose of Cost Accounting
The principal
activities or tasks of Cost Accounting include:
(i) Determining costs and profit for an
accounting period.
(ii) Preparing data to aid in the control,
reduction or improvement of cost.
(iii) Aiding and participating in the creation
and execution of budgets.
(iv) Creating inventory values for costing and
pricing purposes and, at times, controlling physical quantities.
Scope of Cost
Accounting:
Cost Accounting
is generally considered and discussed as being applicable only to manufacturing
operations. Undoubtedly, cost accounting in this field has reached its highest
development. However, almost every type of financial activity can benefit from
cost accounting.
In modern times, cost accounting concepts, techniques, standards, and cost controls have been applied in the field of marketing, administration, banking, insurance, public utilities, finance companies, departmental stores, hospitals, hotels, education institutions, local government agencies, transportation companies, rail roads, airlines, shipping companies, and even in professional offices, such as lawyers, doctors, teachers and accountants.
Comments
Post a Comment