Different methods of calculating costs in Cost Accounting

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Cost accounting is a system of accounts, adjusted to the general ledger, identifying and valuing the elements of profit for the year and allow the interpretation and exploitation by company management. It brings each of its costs, whether incurred in the year or in previous periods. It divides the results by decision center for better management or consolidated by line of business, in order to better assess the situation. It is sometimes associated with other management techniques such as budget management or management by objectives, which it provides the basis for comparison as management accounting.

Long reserved for large industrial companies (we spoke in the nineteenth century industrial accounting), because of its complexity and cost of implementing cost accounting has become widespread with the advent of IT and management software that have greatly reduced the cost of collection and processing of detailed information. It now covers all forms and sizes of companies, of which it is a key component of the information system.

Extraits

[...] Different methods of calculating costs in Cost Accounting PLAN MATTERS INTRODUCTION 1 I. The primary difficulty of the knowledge of the result of exercise 1 II.The resolution of the above problem without cost accounting 2 III.The homogeneous sections method and full costs 2 IV.The delicate question of overheads and the level of activity 3 V.The method of rational allocation 4 VI. The method of direct costing 4 VI. GP method 5 VII. UVA method: an extension of the GP method 6 VIII. [...]

[...] Management framework ceases to be a legal business but the division, department or service. Similarly, we may seek to consolidate the results of activities that are similar in nature but performed by different legal entities. Similarly, the State became the manager includes many activities that must impose analytical systems to monitor performance , a fundamental change of attitude in a world where the "public service" was not required to take into account concerns accounting . Many SOEs have made accounting from the late 1980s. [...]

[...] " This example shows much stronger than we sometimes think between general concepts and analytical bond. The difficulty in the method is of course to define 'normal' levels that can be set is compared to the past, or relative to a prediction is compared to the ability of the plant or production line. VI. The method of direct costing This method aims to emphasize the dynamic effect of sales management by proposing to determine their contribution to the absorption of fixed costs and the overall result. [...]

[...] This is why the method was pushed by consulting firms specializing in time studies (MTM etc . This very clever method is now replaced by the UVA method. VII. UVA method: an extension of the GP method This method improves the full cost method and is an alternative to the ABC method. It is also based on a careful analysis of activities (as routings), but especially on the positions (basic working operation consists of a set of material and human resources that work seamlessly). [...]

[...] Key distribution which must regulate the ventilation sections are not always easy to imagine, let alone see. Which leads to sometimes shaky constructions and insignificant. The output results can be a long wait. Wait several months for arbitrary numbers may have discouraged more than one company. But above all it entails an arbitrary variation of a complete product based on circumstances that are not the responsibility of the producers cost. Therefore it does not allow a meaningful dialogue to improve management. This point deserves a specific development. [...]