Basic Concept - Dani Ki Costing - CA IPCC Video Lectures
Basic Concept - Dani Ki Costing - CA IPCC Video Lectures | Basic Concept - Dani Ki Costing - CA IPCC Video Lectures | Basic Concept - Dani Ki Costing - CA IPCC Video Lectures | Basic Concept - Dani Ki Costing - CA IPCC Video Lectures | Basic Concept - Dani Ki Costing - CA IPCC Video Lectures | Basic Concept - Dani Ki Costing - CA IPCC Video Lectures
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Dani
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Basic Concepts of Costing
Costing is a technique to determine the cost of product or service
or any other thing whose value can be quantified. Basic concepts consist of
basic understanding of the terms like cost, costing, cost accounting and cost accountancy,
cost units, cost centers, cost objects, cost drivers, etc. Cost is nothing but
the expenditure incurred for manufacturing a product or providing service or
any other activities.
Cost accounting can be used at many different areas. It has a very
wide scope as it is used for the purpose like cost accounting, cost analysis,
cost comparisons, cost control, cost reporting, and much other compliance. In
short it is of great use for management for decision making regarding setting
of sales price of the product, setting profit margin, for making cost cutting
techniques and other decisions which may be helpful in increasing profitability
of the business.
The cost accounting is a concept in which the accounts are prepared
to provide information regarding ascertainment of cost while in case of
financial accounting; the purpose is to provide information regarding financial
performance and status of the unit. Cost Accounting is very important to have
control over direct and indirect cost, measuring efficiency, for preparing
budgets, for determining price, and the most essential point is it is very
helpful in curtailing of loss during the off season.
The cost accounting system carries lots of advantages such as it
helps in reducing cost, can be used in analyzing product profitability and also
important in analysis of variance. To avail such advantages, a good cost
accounting system is required. The prerequisites of a good cost accounting
system is the date collected must be accurate, it must act as support for
management and the cost accounting system must be simple and informative.
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