Cost Accounting

I've worked for a few obvious companies, all in manufacturing. It's improbable to me how the cost systems can be so different from one set to the other.



On my initial Cost Accounting appointment I was fortunate enough to be hired into a company that was pro-cost accounting. In truth the CEO demanded that everyone benefit the anguish. We developed an activity cost system that was the envy of many. I can honestly say that the costs were good in the system.



Afterward that company was purchased by a substantial corporation that reduced us down to a very watered down standard cost system. It was miles from where we were. The costs were a joke after having had such a principal system.



Subsequently I went from abominable to worse, into a very huge corporation that did not distress about costs at all. The engineering unit ran the company. What a effort that was.



So, from my perspective the worth of cost accounting needs to be explained to individuals that race the companies. What a misuse for a company to remain making errors in reasoning for the reason that they Don't know their costs.



Cost accounting is really fundamental to a company's survival. There are many that mediate that accounting is a non-value added cost, but how improper they are.



If management does not know what a product or service costs, then how can the business be good. Surely, some people and businesses are lucky and happen to be fine in spite of uninformed decisions. However, in the very competitive world we are in, we cannot count on luck.