Cost accounting is generally considered as being applicable only to manufacturing concerns. This is not so. Its applications are in fact much wider. All types of activities, manufacturing and non-manufacturing, in which monetary value involved, should consider the use of cost accounting. Wholesale and retail business, banking and insurance companies, hotels, hospitals, schools, colleges, universities, farming and cinema houses, all may employ cost accounting techniques to operate efficiently. It is only a matter of reorganization by the management of the applicability of these costing concepts and techniques in their own fields of the endeavor.
The cost accounting is ascertainment of cost, fixation of selling price, proper recording and presentation of cost data to the management for measuring efficiency and for cost control. The aim is to know the methods by which expenditure on materials, wages and overhead is recorded, classified and allocated so that the cost of products and services may be accurately ascertained; these costs may be related to sales and profitability may be determined. Yet with the development of business and industry, its objectives are changing day by day.
The cost accounting is ascertainment of cost, fixation of selling price, proper recording and presentation of cost data to the management for measuring efficiency and for cost control. The aim is to know the methods by which expenditure on materials, wages and overhead is recorded, classified and allocated so that the cost of products and services may be accurately ascertained; these costs may be related to sales and profitability may be determined. Yet with the development of business and industry, its objectives are changing day by day.