Reasons for cost allocation, Cost Accounting

Reasons for Cost Allocation

1. To provide comparison along with externally provided services:  It helps in assessing where to continue the contact or service outsiders.

2. To facilitate ideas on the efficiency of service departments: It assists to determine where a service department is operating efficiently and its size is optimal.

3. To discourage unnecessary service via some managers like they identify they'll be charged.

4. To facilitate opportunity for cost price-quality tradeoffs: Cost allocation assists to remove friction among departments. Since a user department such demands higher quality recognizes that it will contain to bear higher costs.

Posted Date: 2/5/2013 7:49:21 AM | Location : United States

Related Discussions:- Reasons for cost allocation, Assignment Help, Ask Question on Reasons for cost allocation, Get Answer, Expert's Help, Reasons for cost allocation Discussions

Write discussion on Reasons for cost allocation
Your posts are moderated
Related Questions
The following information relates to Araceli Manufacturing Company: total estimated manufacturing overhead cost at beginning of year $864,000 predetermined overhead rate (based

What are the factors affecting working capital requirements

Q. What kinds of benefits have communities realized due to FCA? Communities have understood the following benefits by using FCA: • Rates or tipping fees are set right and fa

XYZ Corporation recieves $100,000 from investors for issuing them shares of its stock. XYZ's journal entry to record this transaction would include a a debit to investment b

Dividends                                                                                        ................ Non-operating losses not passed through P and L A/c

Sony manufactures battery for Iphone 6+. The average costs to manufacture batteries are $4 for 10,000 ad $2.67 for 30,000. Assuming the total cost function is linear, what will be

Methods Required To Allocate Joint Costs 1) Physical/Unit Measure 2) Constant gross margin rate 3) Net realizable value.

LIMITATIONS OF COST ACCOUNTING Cost Accounting similar to additional branches of accountancy is not an precise science although is an art which was developed throughout theorie

Describe the meaning of the fixed production overhead variances calculated under the standard absorption costing system and talk about their usefulness to the management of X Ltd.