Costing Methods Comparison
Added on 2020-02-24
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Management Accounting for cost & control
1By student name ProfessorUniversityDate: 27August 2017.1 | P a g e
2ContentsQuestion no 1..............................................................................2Question no 2..............................................................................2Question no 3..............................................................................2Question no 4..............................................................................4Question no 5..............................................................................6Question no 6..............................................................................7Question no 7..............................................................................8Question no 8..............................................................................9Question no 9...........................................................................13Question no 10...........................................................................15Refrences....................................................................................172 | P a g e
3Question 1Business reports are very helpful for the administration of the company. They provide ansummary of the financial position of the company, and that helps the managers in taking importantdecisions. These reports must be very accurate and should be free from errors. The magemnt mustensure that proper audit of the reports is done, before such decisions are taken. The major businessreports consist of the income statement, the cash flow statement and the statement of equity. Thesereports helps the managers in taking important decisions keeping in mind the overall position of theinvestors and the stakeholders. Different management reports are prepared throughout the year, basedon the same the mangers can ask for monthly, quarterly return and special returns when the needarises. All these are very helpful for the management of the company it provides a basis of importantdecisions. [ CITATION Ann17 \l 1033 ].Question 2Once the basic planning is done, it is important that the managers ascertain that the companyestablishes proper control measures. Control function is very critical for the success of the overallbusiness. After the planning process so completed, the budget formulation is done, the main work of themanagers to see that these plans are properly implemented. Few of the basic cost control functionsincludes, setting up of the standards, making comparison and then checking the overall reasons of thedeviation. Panopticm is a social theory that has been developed by a French philosopher. It putspressure on the point that people who are involved in the overall mechanism of a process, functionsbetter when they know that they are placed under some surveillance by the authority. If we apply thesame in an organisation, it helps us to understand that if the employees are aware that certain controlfactors are established, the employees have to work properly. The fear of constant surveillance isnecessary[ CITATION Hop17 \l 1033 ].Question 3The main four process of product costing that has been identified in the text are –Product costing in financial accounting is something, which will help the mangers in knowningwhat will be the effect of the total cost product on the finances of the company.It is used forcomputation of the closing value of the inventories and the cost of goods sold.3 | P a g e
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