Learn about the applications of Marginal Costing:- 1. Cost control 2. Profit Planning 3. Performance evaluation 4. Fixation of selling price 5. Selection of most profitable product mix 6. Make or Buy decision 7. Shut down or continue decision 8. Effect of changes in selling price 9. Level of activity planning 10. Product Diversification 11. Sell or Further Process Decision [...]
Read this article to learn about - 1. Time wage system 2. Piece wage system 3. Advantages of Time wage system 3. Disadvantages of Time wage system 4. Advantages of Piece wage system 5. Disadvantages of Piece wage system 6. Formula for the calculations of Earnings. 7. Pros and cons and field of application of the various methods of wages [...]
Everything you need to know about Costing Methods. Learn about - Job Order Costing, Process Costing, Operating Costing, Output Costing, Multiple Costing and Batch Costing. Job costing is the basic costing method applicable to those industries where the work consists of separate contracts, jobs or batches each of which is authorized by a specific order or contract. For example, Contract [...]
Cost audit is, however, a preventive measure. It acts as a check on expenditure. It is a barometer of efficiency of performance. It is also a guide to managerial decisions. The objectives of cost audit is to ensure the correctness of accounts, records and statements and to prepare a report on the basis of records. Some of the objectives of [...]
The definition of cost audit given by the Institute of Cost and Works Accountants of India. "It is an audit of efficiency of minute details of expenditure, while the work is in progress and not a post mortem examination. Financial audit is a fait accompli. Cost audit is mainly a preventive measure, a guide for management policy and decision, in [...]
A budgetary control is one of the important tools of control. It involves a constant checking and evaluation of actual with the budgeted figures in order to take corrective action where ever necessary. The Written form of forecasts made in respect of various functional activities of a business concern is called a budget. When the budget so prepared is used [...]
Wages, in the widest sense mean, any economic compensation paid by the employer under some contract to his workers for the services rendered by them. Wages, therefore, include family allowance, relief pay, financial support and other benefits. But, in the narrower sense wages are the price paid for the services of labour in the process of production and include only [...]
Everything you need to know about methods of inventory control. Inventory valuation affects the profitability, the business unit must take enough care to ascertain the correct value of inventory. To ensure this, the method of valuing the inventory should not be changed from year to year. Inventory includes stock of raw materials, work-in-progress, finished products and stores and spares. Inventory [...]
Everything you need to know about types of budget. Budgets are prepared for every business function such as sales, production, purchases, personnel, finance, etc. As such, they are called functional budgets. In fact, every department of a business concern is expected to perform a particular function. Budgeting is a comprehensive exercise. It extends throughout the organisation. As such, there are [...]
Accounting is known as the language of business. It communicates operational result of business to various interest groups, such as, owners, managers, employees, creditors, consumers, government and general public. Financial Accounting and Cost Accounting are two types of Accounting.