introduction of cost and managerial accounting
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INTRODUCTION OF COST AND MANAGERIAL
ACCOUNTING 18/03/2013
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Cost accounting ?
Cost accounting is a formal system of accounting for costs in the book of account by means of which costs of product and services are ascertained and controlled.There is a difference between costing and cost accounting.Costing means finding out cost of product or service by any technique or method, cost accounting means costing using double entry system.
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Objectives and functions of cost accounting
i. Ascertainment of costii. Control of costiii. Guide to business policyiv. Determination of selling pricev. Measuring and improving
performance
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Difference between financial and cost accounting
Purpose
Statutory requirement
Analysis of cost and profit
Perodicity of reporting
Control aspect
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Historical and predetermined costs
Format of presenting information
Types of transaction recorded
Types of statements prepared
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Costing system and its installation
Steps in installation:
1. Preliminary investigation
2. Organization structure
3. Modification of methods
4. Examined methods
5. Record designed
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6. Size studied
7. Effectiveness
8. Avoid unnecessary details
9. Operation of system
10. Introduction
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Management accounting & its relation to cost & financial
accounting Management accounting means any form of accounting
which enables a business to be conducted more efficiently.
It is an integral part of the mangement which is concerned with identifying, presenting and interpreting information used for: formulating strategy planning and controlling activites decision making optimising the use of resources disclosure to shareholder safeguarding assets
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Preparing profit &loss account &
balance sheet
Analysing cost for
control & maximizing efficiency
Assisting managementfor planning,
decision making and
control
Financial accounting
Cost accounting
Management accounting
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Scope of Management Accounting
1. Financial accounting
2. Cost accounting
3. Budegting and forecasting
4. Tax planning
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5. Reporting to management
6. Cost control procedures
7. Statistical tools
8. Internal control and internal audit
9. Financial analysis and interpretation
10. Office services
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THANK YOU