Accounting For Managers: Assignment

Accounting for managers Assignment

Prepared by :-srikanta

What

is cost accounting?

It is the process of accounting for cost. The process begins with recording of income & expenditure and ends with preparation of statically data. It is

COSTING IS AN AID TO MANAGEMENT.

Planning, decision-making & control are the three important functions management.

PLANNING: Thinking in advance . In planning, management is concerned With laying down objectives & determining the courses of action to be followed out of several alternatives available to

DECISION-MAKING: Management has to make a choice of one course of action out of several alternatives course of action available, it involves decision-making. All decision are based on accounting

CONTROLLING: It is the part of management activity whereby managers compare actual performance against the planned performance, find out the deviation &take remedial steps to remove the deviation .so simply we can say control means correction.

A good system of cost accounting serves management in the following ways :-

A.Classification & sub-division of cost B.Control of materials , labour & overhead cost C.Business policy D.Budgeting E.Standard of measuring efficiency F. Best use limited resources G.Instrument of management control H.Cost audit I. Special factors J. Price determination K.expansion

What is cost center? It is the smallest segment of activity or area or responsibility for which cost are accumulated.

Types of cost center A. Personal &impersonal cost center B. operation &process cost center C. product & service cost center Marginal cost; It is the cost which is used for managerial decision. It is the variable cost I.e. prime cost plus variable over head

Sunk cost; It is also used for managerial decision. A sunk cost is a cost that has already been incurred and that cannot be changed by any decision made now or in the future. Sunk costs are irrelevant and should be ignored in decisions. It is recoverable