Cost account ledger system, Cost Accounting

Assignment Help:

Cost Account Ledger System

A cost account ledger system is essential to analyze accounting information in order such costs may be accumulated for individual cost centers and charged to cost units. The information in the cost ledger will be employed for a range of planning, decision and control making reasons. 

- The cost ledger control account in the financial ledger is a memorandum account that records the financial information that has been extracted for employ in the cost ledger.

- The financial ledger control in the cost ledger has two main reasons as:

(i) It creates the cost ledger self-balancing:  It gets the place of an asset liability accounts in that one leg of the double entry would appear the financial ledger for all transaction as an example of the purchase of material on credit would be credited to sundry creditors control account in the financial ledger. In the cost ledger, it is credited to the financial ledger control account.

(ii) It enables an internal check to be performed via comparing its balances along with that of the cost ledger control account in the financial ledger.  Both must record a balance that represents stock balances or Raw material, W.I.P and financial goods the total profit, while all other transactions have been completed.  Any type of difference should be reconciled and investigated.  Hence the final trial balance in the cost ledger will appears:

 

Dr

Cr

 Stores Ledger Control a/c

x

 

 W.I.P. control a/c

x

 

 Finished Goods Control a/c

x

 

 Costing Profit and Loss a/c

 

x

 Financial Ledger Control a/c

 

x


Related Discussions:- Cost account ledger system

Cost classifications and estimation, Cost Classifications and Estimation ...

Cost Classifications and Estimation Cost classification may be defined like 'the arrangement of cost items in a logical sequence having concern to their nature and reason to b

Determine which project is more lucrative - investment , The Zooline Compan...

The Zooline Company (Pty) Ltd is an American based company that focuses on the LSM 8 -10 markets. They do vehicle interiors, raise or lower suspensions and install top end sound sy

Factors affecting fund requirements, By the discussions we had previous, it...

By the discussions we had previous, it is not tough to come to the conclusion that numerous factors influence the fund or net working capital needs. Fund needs vary along with t

Stores layout and location - material handling, Stores layout and location ...

Stores layout and location - Material Handling The layout of stores must ensure as a) For movement of material, ease of access out and in of stores b) The issue of peris

Storage and issue of material, Storage and Issue of Material A number ...

Storage and Issue of Material A number of questions are relevant in this control of materials throughout storage and question of materials. These are as: a) Stock control r

Incremental costs as relevant costs, Incremental Costs as Relevant Costs ...

Incremental Costs as Relevant Costs An incremental cost is specifically incurred with the following a course of action and ignorable if such action is not implemented. It cont

Absorbtion of overheads, interaction with an expert/cost accountant to kno...

interaction with an expert/cost accountant to know the overhead absorbtion policies and procedure followed

Fixed overheads variance, Fixed Overheads Variance This is defined lik...

Fixed Overheads Variance This is defined like the difference between the fixed overheads attributed and the standard cost of fixed overheads absorbed in the production achieve

Calculate the nominal interest rate, A 1- year Canadian bond with a face va...

A 1- year Canadian bond with a face value of 5000 can be purchased at 4800. a) Calculate the nominal interest rate in Canada. b) if the Canadian dollar is expected to depreci

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd