To disclose the source of economy in material, labour and overheads
Planning and Forecasting :
Management requires information to look into the future. Moreover, it has to ensure that adequate resources are made available and plans are achieved at the least cost. Formulation of budgets, pricing of few products or investment in new projects or investment in new projects, etc. are all examples of costing information being an aid to planning. Thus, costing helps management plan the products to be produced in order to priority and quantity & of production, fixation of optimum selling price, associated costs and expected profits
Control and Assessment:
An important managerial task is to ensure that operations, departments, processes and costs are under control. The Cost Accounting system is the key financial control system and monitors the results of all activities as well as other control systems. The detailed analysis of all expenditure, calculation of job and production costs. analysis or lose” and scrap. monitoring of labour and departmental efficiency and other outputs of the costing system provide a sound basis of information for control.
Decision-Making :
Decision-making involves making a choice amongst alternatives. Intelligent decision making largely depends on various types of accounting data.