Cost Accountancy Question: Download Questions PDF
Explain what things would you take into consideration while installing a costing system?
Answer:
Following things should be taken into consideration while installing a costing system:
-Nature of the Product is a very important deciding factor in installing an effective costing system.
-Nature of the Organisation should be considered before installing costing system.
-Objectives of the Organisation should be met with the installed costing system.
-Manufacturing Process: Before installing the costing system the technicalities of the manufacturing process should be studied carefully.
-Technical Details of the business must be studied before introducing new costing system.
-The system should be informative and simple. The system should be simple and easy to use in order to maintain various cost records.
-Reporting Systems: The costing system should be designed in such a way that reports are generated in a proper way to facilitate the cost control decisions.
-The costing system should be elastic and capable of adapting according to the changing environment.
-Nature of the Product is a very important deciding factor in installing an effective costing system.
-Nature of the Organisation should be considered before installing costing system.
-Objectives of the Organisation should be met with the installed costing system.
-Manufacturing Process: Before installing the costing system the technicalities of the manufacturing process should be studied carefully.
-Technical Details of the business must be studied before introducing new costing system.
-The system should be informative and simple. The system should be simple and easy to use in order to maintain various cost records.
-Reporting Systems: The costing system should be designed in such a way that reports are generated in a proper way to facilitate the cost control decisions.
-The costing system should be elastic and capable of adapting according to the changing environment.
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