Basic contribution  of accounts and finance  to cost reduction  strategies is to provide
datas  for variances for material price , material consumptions , labour variations , cost of
production .

Major activity related  to cost accountings are


Budgeting

Budgeting is prime  function of accounts and finance  in which cost are allocated  for one
financial year  and then  performance are measured  against fixed budget .

Negative variances  are then  highlighted in monthly reviews , Corrections can made  for
these variances .




Costing

Prepare  or calculate  price for product taking into  all cost involved  in production ,
labour , energy ie  fixed and variable cost and other overheads .

prices are increased or lowered  by doing costing of product.


In earlier days of accounts operation it used to have cashier and  salary disbursement
clerks ,these are now obselete as arrangement can be made with banks for  
disbursement of salaries  .This has resulted in  increase in efficeincy and lower
manpower in accounts .
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