Archive | Cost Accounting

The Distinction Between Direct and Indirect Material In Cost Accounting.

Store accounting is important due to the following reasons:

Store / Inventory control technique is the important tool in the hands of the modern management. It is indispensable for each and every manufacturing concern.

Material control is a systematic control over the purchasing storing and using of material to minimizing the possible cost.

Perpetual store verification is other wise known as perpetual inventory system. It is the system of records maintained by the controlling department which reflects the physical movement of stocks and their current balance.

Wastage: Wastage comprises invisible loss, visible loss that can not be collected and also un-saleable portion of the collected loss.

The following are the Advantages of LIFO Method:

As against the First in First Out method the issues under this method are priced in the reverse order of purchases i.e., the price of the latest available consignment is taken.

The following are the main advantages of FIFO Method:

Under FIFO method material is first issued from the earliest consignment on hand and priced at the cost at which that consignment was placed in the stores.In other words, materials received first are issued first.

The Difference Between Bin Cars and Store Ledger.

This ledger is kept in the costing department and is identical with the bin card except that receipt, issues and balances are shown along with their money values.

Store keeper is the important person for the store. He is the in charge of the store department and also responsible for store control.

The Main Objective of Material Control are as follows:

Store keeper is the head of the store department. He is required to posses some qualifications as noted below:

Purchase Officer is the head of the purchase department. He is also purchase executive, Purchase Manager or purchasing director.