Purpose of Cost Accounting - 3614 Words

CH01_Bragg_36794 3/13/01 9:40 M Page 9 PART I Purpose of Cost Accounting 9 CH01_Bragg_36794 3/13/01 9:40 M Page 10 CH01_Bragg_36794 3/13/01 9:40 M Page 11 CHAPTER 1 Role of Cost Accounting When properly implemented, the cost accounting function can have a pervasive influence in the modern corporation. Unfortunately, it is not always properly implemented because management often is not completely aware of all the uses to which the cost accounting function can be put. This chapter describes the main categories of activities in which this function can become involved, and can be used as a guide by the controller in creating a well-rounded niche for the cost accountant. EXTERNAL REPORTING The key task for†¦show more content†¦Business unit-level reports. These reports must include a much larger quantity of information, for the recipient (the plant manager) needs to know about the operation of each department, as well as a host of operational issues such as the cost of quality, inventory turnover, machine utilization, profitability, and cash flow projections. This tends to be the most voluminous of all reporting packages, as well as the one that includes the greatest mix of financial and operational information. Function-level reports. These reports can be issued to individual departments or at lower levels, for example, to the supervisors of individual machines. Such reports are custom-designed for each recipient, with some requiring more financial data (e.g., for the sales manager who wants to know about customer bad 12 †¢ †¢ CH01_Bragg_36794 3/13/01 9:40 M Page 13 SCOREKEEPING debts or orders booked) and others including almost entirely operational information (e.g., for the warehouse manager who is interested in inventory turnover, kiting percentages, and receiving accuracy). †¢ Project-specific reports. A project report is slanted more toward just those costs being incurred for a specific purpose and so tends to be heavy on direct costs and light on most other allocations. This report usually compares incurred costs against budgeted costs expected to haveShow MoreRelatedPurpose of Cost Accounting3624 Words   |  15 PagesCH01_Bragg_36794 3/13/01 9:40 M Page 9 PART I Purpose of Cost Accounting 9 CH01_Bragg_36794 3/13/01 9:40 M Page 10 CH01_Bragg_36794 3/13/01 9:40 M Page 11 CHAPTER 1 Role of Cost Accounting When properly implemented, the cost accounting function can have a pervasive influence in the modern corporation. Unfortunately, it is not always properly implemented because management often is not completely aware of all the uses to which the cost accounting function can be put. This chapter describesRead MoreCost Accounting Terminologies, Purpose of Cost Information, Types of Cost Accounting Report Etc3664 Words   |  15 PagesConceptual Framework Cost Accounting Cost accounting, as a tool of management, provides management with detailed records of the costs relating to products, operations or functions. Cost accounting refers to the process of determining and accumulating the cost of some particular product or activity. It also covers classification, analysis and interpretation of costs. The cost so determined and accumulated may be the estimated future costs for planning purposes, or actual (historical) costs for evaluatingRead MoreEssay about Role of Managerial Accounting1112 Words   |  5 Pagesbusiness costs down which involve internal and external actions. For internal control, the accountant has a responsibility to monitor finances of a company. Other responsibilities include keeping track of liabilities, duties and taxes. Furthermore, analyses of measurement data on creditors or stockholders are also provided by an accountant. This essay will seek to prove that through principles of financial accounting, cost accounting and cost man agement, accountants can control the cost of businessRead MoreIntermediate Accounting 9th Canadian Edition - Chapt1385 Words   |  6 Pagesadded to or deducted from accounting income to arrive at taxable income. 1. Financial reporting purposes: straight line depreciation method is used for plant assets that have a useful life of 10 years; for Tax Purposes: CCA declining balance method is used with a rate of 20%. i. Reversing Entry that results in future taxable amounts and, therefore will usually give rise to a future income tax liability. * Asset’s cost is deducted faster for tax purposes than it is expensed for financialRead MoreManagerial Accounting And The Certified Management1408 Words   |  6 PagesManagerial accounting is used by an organization to ensure informed decisions are made regarding current and future operations. Businessmen and women must have the ability to comprehend financial information provided to properly determine the correct course of action. In the global market of today, an organization’s inability to accurately determine the best course of action can lead to financial ruin for the company. Uninformed decisions by leadership can derail a business’ prospects for successRead MoreNature and Purpose of Management Accounting1248 Words   |  5 Pagesâ€Æ' The primary role of management accounting is to information in a timely manner to the company’s provide relevant management to help them plan and control the activities of the organization and with which optimal and sound decisions can be made. All the topic areas examined relate to this primary role. Although this role and its related topics covered are clearly understood by most, if not all candidates or even managers in the organizations, different types of relevant information areRead MoreManagerial and Financial Accounting1235 Words   |  5 Pagesï » ¿Part 1 Managerial and Financial Accounting: Key Differences Several differences exist between the above branches of accounting. To begin with, when it comes to financial accounting, the financial reports prepared are primarily utilized by external users including but not limited to regulators, creditors and stockholders (Weygandt, Kimmel and Kieso, 2009). On the other hand, managerial accounting reports are primarily meant for internal users i.e. managers and other officers of the firm. TheseRead MoreHSM 340 Week 2 Quiz689 Words   |  3 Pagescash during the accounting period in the categories of operations, investing, and financing, is called a(an):    Student Answer:   Income statement      Statement of retained earnings      Balance sheet      Statement of cash flows      Report of management    Instructor Explanation: Chapter 9    Points Received: 0 of 5    Comments: Question  2. Question : (TCO 2) Two major methods of asset valuation are:    Student Answer:   historical cost and future cost      historical cost and acquisitionRead MoreAccounting Analysis : Accounting And Accounting1034 Words   |  5 PagesAccounting Analysis In the accounting analysis part, we will discuss and analyse SUL’s accounting policy by identifying its key accounting policies, assessing the accounting flexibility, evaluating the accounting strategy, evaluating the quality of disclosure, identifying red flags and undoing accounting distortions to evaluate that if SUL’s financial statement is transparent and not misleading. Also, we will compare these elements to its competitors in order to give investors a clearer vision ofRead MoreAgency Theory and Accounting Choice1142 Words   |  5 Pages CHAPTER ONE INTRODUCTION 1.1 BACKGROUND TO THE STUDY This study analyses the effect of the agency theory and accounting choice usually been made by managers of Nigeria listed companies. It (agency theory and accounting choice) can be demonstrated in the modern day companies where management is usually separated from the ownership of business. The professional managers are supposed to make decisions and take actions that are consistent with the objective of maximising shareholders wealth. But this