identify the role of cost accounting in a business


In Nigeria today West Africa and indeed all over the world cost accounting has become the bane of which many organization exist. This means that there is virtually no organization that does have accounting in its operation.
In most business organization the role of cost accounting cannot be over emphasized because of it’s important in the day to day running of every business.
In socialist and capitalist nation cost accounting becomes fundamental because in it, we look at the past, present and attempt to protect the future of any organization.
Cost accounting has been define by the Chartered Institute of Management Accounting (CIMA) in its publish terminology defined cost accounting as the application of costing principles, methods and techniques of the science, art and practice of information derived there from for the purpose of managerial decision making.
Costing accounting can also be viewed as the collection, classification, conducting, analyzing and reporting of cost information for the establishment f the total cost of performing and activity or operation and for the purpose of management planning decision making and controlling an enterprise.
Cost accounting attempts to give a rough estimate regard the work to be carried out in a small and medium scale business input with determine the fixed price of the finished goods. Without cost accounting, it is difficult, if not impossible, to quantify and qualify any item in order to attain a price to it.
In auditing; cost accounting has also become very essential, this is because, we have to identify the input of employees in order to enable us fix salaries and wages for them. This in itself is cost accounting.
Cost accounting is one of the branches in accounting. Cost accounting by its tradition is seen to be basic inputs with which an organization can survive. Unlike, financial accounting, auditing, taxation, public sector accounting falls within the preview of managerial accounting or the protection of the future is determined.
How is cost accounting applied in an organization?
How is cost accounting different from other branches of accounting?
These and many other from the basic on which this topic is undertaken
The purpose of this study is to identify the role of cost accounting in a business. This is done with the view of applying its principle to the growth and development of an organization.
Also, this study is aimed at helping our business managers, educational planner and administrators and chief executives not only in financial industries, but also those in allied organization to make appropriate budget and budgeting control.
As already noted the importance of cost accounting cannot be over emphasized, for this course therefore this study is undertaken to identify and examine the role of cost accounting in a business. Therefore, it is straighten the in-balance, abuse and lack of projection that has existed in the management of a business for a very long time.
Similarly, it is also the objective of this study to put in place cost accounting as a rudiment for effective management of accounting of income and revenue yield. Cost accounting became popular at the beginning of the 20 century following the change in modern business as a result of the industrial revolution. Cost accounting has been developed to meet its purpose.
Filling the gap of providing detailed analysis of operating result of a unit of production or a particular job or an activity which was not possible in financial accounting system. Providing a mechanism for ascertaining historical cost to unity of product for the valuation of stock (finished goods and partly finished goods) W.I.P and income or profit determination for financial accounting report.
This study takes a look at the role of cost accounting in a business. To guide the researcher in carrying out effective research, the following questions were postulated.
a. Does cost accounting exist in modern businesses? b. How often is cost accounting carried out in an organization? c. Does management see cost accounting as a panacea to effective managerial organization? d. Is cost accounting a specialist discipline in accounting? e. How does cost accounting minimize wastage in an organization? f. Does cost accounting increase profit? g. Does cost accounting increase production output? h. How does cost accounting help in fixing prices?
There are two types of hypothesis the Null hypothesis and the alternative hypothesis
Ho: Null hypothesis
Hi: Alternative hypothesis
Ho: The importance of cost accounting can be emphasized in an
Hi: Theimportance of cost accounting cannot be emphasized in an
Ho: Cost accounting does not lead to effective managerial practice
Hi: Cost accounting leads to effective managerial practice
Ho: Cost accounting does not help to minimize wastage in any organization.
Hi: Cost accounting is not expedient enough in price fixation on different product of the organization
The study is not without constrains owing to geographical vastness of Nigeria. The states covered in the research work are relatively large state and it was impossible to cover every enterprise in these states.
Time was also a limitation as the period provided to cover the states was short owing to the abridged semester.
The research work has to be done in a hurry.
Finance, which has always been a limitation in the economy, must also be mentioned here, money was needed to move from one town to another ad this was impossible to have data collected from all parts of the federation this is why the research work was limited to Ogun state.
There was also man-made contains, such as the uncompromising attitude of many respondents. Some of the enterprises visited refused to give us audience, saying that they were very busy to accommodate us.
Some of those interviewed believed that the exercise was in connection with taxation and some of the questionnaires sent out to respondent were not received.
It is not possible for the researcher to reach all industries in the economy to find out how far cost accounting is being applied.
Neither, is it possible to reach all industries of commercial in a state for the purpose.