COST ACCOUNTANCY

ASSIGNMENT

CASE STUDY

COST OF PRODUCTION REPORT

M. SWATHIKA

20CMH31
THE APPLICATION OF COST ACCOUNTING TO
MANAGEMENT PLANNING, CONTROL, AND
DECISION MAKING

ABSTRACT

This research work is aimed at highlighting the role played by Cost accounting information in
the planning, control, and decision-making process of the management of an organization
using a Nigeria bottling company (NBC) as a case study. If identify the different costing
techniques and methods available, the type of information produced by an accountant, and
how each piece of information fits into the information needs of management as stated in the
alternative and s discovered by the researcher through questionnaire and personal interviews.
That is, the prospect of a manufacturing company Endeavour is to find out, that for any
organization to be successful, there must be an accounting department to prove timely,
adequate, relevant, and correct information regarding the cost of products, processes, and
general running of the firm and fix selling price for products and services. An independent
cost accountant must be present for the possible production of relevant information.

BACKGROUND OF THE STUDY

The main theme of this project is to highlight the importance of cost to any organization,
using the Nigeria Bottling company as a case study. Every activity and operation of an
organization involves cost. In view of this, I intend to discuss the objectives, principles,
techniques, and methods of costing relating to the analysis and gathering of cost information
for planning, control, and decision-making. It must be emphasized that the existence of a
sound, well-organized basic costing system is fundamental to whatever use is made of the
information, whether for routine cost ascertainment purposes or for a one-off decision.
Decisions depend on financial factors therefore it is of utmost importance that proper costing
methods and techniques suitable for an organization’s operations to be ascertained, adopted,
and operated effectively and religiously throughout the organization’s process and operations.
In essence, organization are established for a defined purpose which objective can only be
seen or shown to the world by the output (product) it produces. For there to be an output the
most necessary is the input. Inputs do not come for free; payments have to be made on them.
Taking the Nigerian Bottling Company (NBC) as a case study, it needs inputs in the form of
raw materials, labour etc. to produce goods (soft drink) and payment must be made for these
inputs, this boils down to cost.

STATEMENT OF THE PROBLEM

In the past, many companies have witnessed considerable lapses and increasing changes in
management disciplines. Costing is an important element in the overall operation of an
organization through the provision of relevant information about cost is one of the problems
organizations are facing. Because there are no satisfactory requirements to maintain detailed
cost records, some small firms keep only traditional financial accounts and prepare cost
information in an ad-hoc-fashion. In all but small firms, this approach is likely to be
unsatisfactory.

There is a vast range of systems in operation ranging from simple analysis to computer-based
accounting systems incorporating standards, variance analysis, and the automatic production
of control and operating statements. These different costing methods are meant to suit
different organizations the adaptation of the wrong method, for a company will constitute a
problem instead of a solution. Also, poor or inadequate knowledge of a particular method of
costing has constituted problems for many firms.

Most companies are still using the simple analysis system to set cost while some companies
do not even have a costing system. This no doubt has led to poor planning, control and
decision-making.
OBJECTIVES AND PURPOSE OF THE STUDY

This project is designed to provide a clear and concise understanding of the importance of
costing to the manager in carrying out his/her responsibility for planning controlling and
making decisions that will lead to achieving certain goals. This research work aims to
highlight that cost is

 Indispensable in determining the cost per unit of a product.

 A factor in pricing decisions, production planning, and cost control.
 An important tool in running a section, department, or factory, is, organizational
planning, the decision on alternative methods, wages cost control, and material cost
control.
 Important in profit planning, making or buying decisions, etc.

SCOPE OF THE STUDY

The research focuses on management accounting and its application to organizational,

planning, controlling, and decision-making using the Coca-Cola bottling company.

CONCLUSION

The role of cost information has a significantly positive effect on decision-making. This
impact is shown by various statistical tools.
COST OF PRODUCTION REPORT OF COMPANIES