Role of Cost Accounting in Organization
Like part of their jobs, such cost accountants interpret results, and then report them to management and give analysis such assist decision-making in the given departments as:
To measure and report manufacturing costs, Cost accountants work closely along with production personnel. The efficiency of the production departments in transforming and scheduling materials into finished units is evaluated for developments.
Engineers and Cost accountants translate specifications for new products for estimated costs; via comparing estimated costs along with projected sales prices, they use to help management to decide whether manufacturing a product will be profitable.
c) Systems design
Cost accountants are becoming more included in designing computer integrated manufacturing as like CIM systems and databases corresponding to cost accounting requirements. The thought is for cost accountants, system designers and engineers to develop a flexible production process responding swiftly to market requirements
The treasurer employs budgets and related accounting reports developed via cost accountants to forecast cash and working capital necessities. Detailed cash reports show whereas there are excess funds to invest or whereas cash deficits exist and require to be financed.
e) Financial accounting
Cost accountants work closely along with financial accountants who employ cost information in valuing inventory for income determination and external reporting reasons.
Marketing included the cost accountant throughout the product innovation stage, the manufacturing planning stage and the sales method. The marketing department increases sales forecast to facilitate preparing a products manufacturing schedule. Cost estimates, supply, competition, environmental influences, demand, and the state of technology find out the sales price such the product will command in the market and will be offered.
Personnel department administers the wage rate and pay methods employed in calculating all staff of employ pay. This department keeps adequate labour records for legal and cost analysis reasons.
On this point, it cannot be over-emphasized such cost accounting is merely an information system designed to created information to assist the management of an organization in controlling and planning the organization's activities. It assists the management also to create informed decisions so like to enable the organization to operate at maximum efficiently and effectiveness.