How Cost Reports are Prepared and Analyzed?

TASK 2

2.1 How cost reports are prepared and
Analysed?
 Cost sheet or cost statements are used for various purposes for top
authorities which includes controlling the inventory in an organisation,
checking efficiency and preparing of incentive plans.
 These reports are very helpful for purpose of analysing the actual costs
that takes place in enterprise to meet short term liabilities.
 Financial accounting will helps in posting journal accounting entries that
are needed to update the ledger accounts for inventory cost allocations.

Cont............
 In costing terminology accounting reports that reflects cost of products
are known as cost sheets which are prepared in different formats such
as absorption and marginal cost sheets that help to reconcile the
amount of profits generated by a corporation.
 It plays vital role in organisation in ascertaining different way to learn
about the areas of a business that are the most profitable and also
those, that require more cost to spent.
 It is created before the start up of a project as the costing reports
provide better estimation about the estimation to which a project will
cost and allowing a venture to plan for enhancing the profit margin.

2.2 Various Performance Key indicators
Key performance indicators refer to a set of values which help to
measure the performance of business in this competitive market.
Quantitative indicators- The financial performance of an organisation is
measured by increasing numbers from past to the future figures.
Qualitative indicators- This will reveal the efficiency, quality and value of
business, attributes and different features which can't be expressed in
numerical forms.