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• Cost control: The first function of cost accounting isto control the cost within the
budgetary constraints management has set for a particular product or service. This is
important since management allocates limited resources to particular projects or
production processes.
• Cost computation: This is the main function of cost accounting and this isthe source
of all other functions of cost accounting. In the section below, we will see how we can
calculate the cost of sales per unit for a particular product.
• Cost reduction: Cost computation helps the company reduce costs on projects
and processes. Reduction in costs means more profits since the margin will naturally
increase.
AMUL -ICECREAM
Office Overheads
Employee Cost 10 1000000
Other Expenditure:
Computer 1.2 120000
Telephone 0.1 10000
Taxes 0.4 40000
Carriage Outward 0.2 20000
COST OF 62.295 6229500
PRODUCTION
2 200000
Opening Stock
-Closing Stock 64.295 6429500
COST OF GOODS SOLD
PARTICULA
CPU Amount
RS
Selling&DistExps:
Advertisement 4 400000
Delivery Vehicles
3.5 350000
1.75 175000
Petrol 0.505 50500
74.05 7405000
Packaging Rates
COST OF SALES