The basic objective of Cost Accounting systems is to reduce the cost of production and maximization of profits. Specifically, the objectives are as follows:
- To ascertains cost per unit of the product or service.
- To provide a reliable analysis of costs.
- To identify the sources of wastage.
- To provide relevant information or determining the price
- To ascertain the profitability of each product.
- To exercise effective control on inventory
- To disclose the source of economy in material, labour and overheads
- To organize effective information system.
- To advise the management on future expansion on programs formulation and implementation of incentive plans.
- To organize the internal audit system
- To undertake the cost reduction programs