Cost accounting is a process of identifying, measuring, analyzing, and reporting the costs associated with a company’s operations. It involves tracking all expenses incurred in the production of goods or services, including direct and indirect costs, fixed and variable costs, and overhead costs. The purpose of cost accounting is to provide management with accurate and timely information about the costs of products and services, so they can make informed decisions about pricing, production, and resource allocation. Cost accounting also helps companies identify areas where they can reduce costs and improve profitability. By understanding the true cost of their operations, companies can make better decisions about how to allocate resources and invest in new opportunities. Ultimately, cost accounting is a critical tool for any business looking to optimize its operations and maximize its bottom line.
