Transport & Service Costing

1080 Words5 Pages
Transport & Service costing Service Costing Unit costing is the method of costing used when the cost units are identical. Identical cost units should have identical costs and this concept of equality of costs is the basic feature of unit costing. It may be noted that process costs, output costing and service costing are the sub-divisions of unit costing method. Service Costing – Nature and Problem: Service or operating cost is the cost of providing services. Service costing is the term applied to describe the system used to find the cost of performing a service such as transport, gas or electricity. Service costs are particularly suitable for the costing of road and rail transport services an they are also…show more content…
The company currently has a turnover of approximately Rs. 10 Crores. The company is a member of Bombay Goods Transport Association (BGTA) AND Indian Bank Association (IBA), which is very essential for the smooth conduct of their business activities. BGTA checks all business malpractices and IBA is needed for regulating payments within different states. The company has its 17 branches all over the country, along with 3 agencies in certain remote areas. The company also provides warehousing facilities to companies like Philips-India and Colgate. The company is involved in delivery of goods all over the country.

Number of vehicles: The company has owned as well as dedicated trucks and trailers. Owned Vehicles 8 HCVs- Heavy Commercial Vehicles
4 Trailers Dedicated Vehicles 25 LCVs- Light Commercial Vehicles Dedicated Vehicles are delivery trucks, which are made according to certain specifications, operated under the name of another company for which they give a minimum amount of business and certain running costs are borne by that company. The company has its LCVs dedicated to ELBEE Delivery Services. They are used for delivering goods given by ELBEE. The driver charges and maintenance charges are borne by Adhunik Transport. Other expenses are borne by Elbee. The advantage to Elbee is that its capital is not blocked. The advantage to the company is that it does not
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