Cost Accounting In Nigeria Essay

Managerial accounting is essential for decision making. Making the best choice depends on the manager's goals, the anticipated results from each alternative, and the information available when the decision is made (Schneider, 2012). The different techniques associated with managerial accounting are very helpful in the decisions that need to be made. In order to truly understand decision making with managerial accounting one must first discern exactly what managerial accounting means and some of the techniques associated with it. The definition of managerial accounting will be discussed along with the techniques of cost management techniques, budgeting, and quality control.

This article discussed variable costing, what is primarily used for and applicability in manufacturing situations. Cost accounting supplies management with the necessary information for decision making (Hasan, 2016). The appropriate costing of a product is essential in taking appropriate managerial decisions (Hasan, 2016).

The management of the cost of the company's product is an important part, which a cost accountant has to deal with. The profit of the company depends on the extent of the control on the production cost of the product. As the increase in sales and the profitability is the main aim of the management, so it will attract more conflicts of views and multiple sources of actions. A cost accountant has work in this direction and clears the things to the management so that they can have appropriate decisions with regard to the product, its costs and the company's profits at

Cost accounting systems are used to supply cost data information on costs incurred by a manufacturing process or department.

Bhimani, A., Horngren, C., Datar, S., Rajan, M. et al. (2012) Management and Cost Accounting. 5th ed. Edinburgh: Prentice Hall, p.369 - 378.

Cost accounting is used to help management understand how much it cost to run a business. Understanding the role of cost accounting is important when one is trying to put together a team of managers to help run the company. The CEO of a merchandising organization needs to hire a CFO to run the accounting system, but the CEO has little understanding of cost accounting. The CEO will hire a consultant to help her understand the role of cost accounting, the role of ethics in cost accounting, and compare and contrast the absorption and variable costing.

Chapters 10 (pp. 396-405) & 16 (pp. 646-651) Cost Accounting: a managerial emphasis (Horngren et al.)

Costing system is the most important part for any business or engineering company. Cost accounting is necessary for a company to be able to exercise control over the actual costs incurred compared with planned expenditure. From the point of view of cost control, a costing system should not only be able to identify any costs that are running out of control but should also provide a tool that can assist in determining the action that is required to doing right things.

Accounting. General Cost Classifications. Product Cost versus Period Cost. Cost Classifications on Financial Statements. Cost Classifications for Predicting Cost Behavior. Cost Classification for Assigning Costs to Cost Objectives. Cost Classification for Decision Making. Review Problems

Primarily cost and management accounting is meant for providing information to the management to enable them making planning and control. Budgeting and budgetary control are tools which can be used by the management to efficiently discharge both the management functions. Budgeting is formal management plan of actions incorporating estimated qualitative and/quantitative facts and figures. Cost analysis, on the other hand, is a process of evaluating, and analysing cost data according to their nature and behaviour to changing circumstances. Effective cost analysis is a prerequisite for preparing different meaningful flexible budgets and also for making effective comparison between budgeted and actual results. The rest of the paper consists of

The costing systems aid companies in determining the cost of a product in relation to the revenue the product generates. The costing systems commonly used in businesses include activity-based costing and traditional costing. Traditional costing system assigns the manufacturing overhead based on the capacity of a cost driver. For example, the amount of direct working hours required to produce a particular item. Cost drivers are factors that cause cost to incur, like machine hours, direct material hours, and direct labor hours. Activity-based costing system allocates cost of manufacturing a product in accordance to the activities required to produce the particular item. It’s therefore essential for managers to understand the merits

Cost and management accounting is an integral element in preparation of an entity’s financial reports. Cost accounting consists of various branches, including; job and process costing, absorption costing, traditional costing and activity based costing. An efficient costing system allows managers and other users of financial reports to make decisions to better the company, in reducing and streamlining costs, to improve overall profits. The way in which managers achieve this can be a rigorous and time consuming task, however, if a costing system can be perfected, productivity and general cost reduction can be achieved and an overall more efficient operation of the business will ensue. This essay will critically discuss factors in which a business consider in deciding on a costing system to implement and operate when establishing a costing system. In this article I will describe the different methods of costing, explain why I believe activity based costing is the most efficient method, and provide a real world example to support my claim.

The traditional costing systems catered to the companies involved in manufacturing of small range of

Cost accounting is a process of recording, classifying, analyzing, summarizing allocating and evaluating various alternative courses of action and control of costs. Cost accounting involves the techniques for:

Cost audit is basically the analysis of cost accounts and also checking on the efficiency of cost accounts and to ensure that these accounts are matching the predetermined cost accounting plans. It also determines the accuracy of the cost accounts. They also ensure that the accounts conform to the principles, plans, procedures and objectives. It shows the deviation in plans. It is also known as efficiency audit as it checks the efficiency of working of predetermined plans. It consists of the sum total of expenditure and revenue and determines the true work efficiency of a plan. It is used to assess the operational efficiency and resource management of an organisation. It is essentially the verification of the cost accounts so as to ascertain the variations in the efficiency of the organisation.