M. Com second semester advanced cost accounting.

Emerging costing approaches

Now a days so many costing techniques for developed to solve the various costing problems.
The ultimate objectives is to provide maximum value to the customer. Some of these
approaches are discussed herewith.

● Business process reengineering

● Just in time
● Value train analysis etc.,

Most of the concern are taking care of the productivity. It aim maximize the productivity why
controlling cost and eliminating the wastage.

Productivity

Productivity is and indexof efficiency. It is the nature of effectiveness of individual or combined

factors used in producing goods and services.

Meaning.

It is the economic measure of output per unit of input that means what we provided asinput for
production and what we get from as a product.

The input include raw material neighbour capital plants and mechinary, components loose tools
etc.,

In the word of m Banerjee the word productivity usually means the ratio between the output of
wealth in the form of goods and services and input of resources used in that output. According
to Peter f drucker. Productivity means the balance between all factors of production that will give
the greatest output for the smallest airport.

In short productivity means the measurable relationship between output and input it is
measuring the ratio of output to input that is output divided by input. Gross income divided by
gross expense.

The productivity measure in different terms example products measured in in number or quantity
labour productivity measured in output per hour.

Production and productivity

Production is outcome of various factors of production in volume. Ine value. in quantum of

goods and services. Productivity is the ratio of output to input. It the efficiency of resources
utilised for production. An increase in production does not necessarily result in increased
productivity.

Measurement of productivity

1. Total or overall productivity. this is an increase in productivity of one factor maybe

counter balance by another and the real picture cannot be obtained. it is easy to
measure the productivity
2. Interdependence of factor productivities. This is one of the factor main effect the
productivity of another factor example laber affected by inferior quality of material and
defective tools. power failure may effect in supply of finished goods.
3. General disagreement as to the measurement of output and input. Where a firm produce
variety of articles it is difficult to measure productivity of the whole undertaking due to 2
difference in the volume of individual product quality and different degree of sub
contractin

Productivity = output / input.

Or
Total cost +nrt added value
_____________________
Total cost