Objectives of Cost Accounting
Cost accounting involves the systematic tracking of expenses and analysis of the same so that an organization is aware of the costs associated with each product it manufactures or service it renders.
With information regarding the cost of each product or service, management can find cost-saving opportunities, fix prices, maximize profits, and so on. Basic objective of cost accounting is :
1. Cost Ascertainment:
→ Enables identification and classification of all costs, distinguishing between direct and indirect costs.
→ Provides a comprehensive understanding of the cost structure, aiding in pricing decisions and cost management.
→ Supports accurate product costing, which is essential for setting competitive prices.