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COST ACCOUNTING SYSTEM

6 May, 2015 - 17:10

The cost accounting system provides a much more effective means of controlling costs than a general accounting system, and offers information on unit costs useful for product pricing and promotion. The cost accounting system uses perpetual inventories. There are two types of cost accounting systems:

  1. job order cost systems used when one-of-a-kind products or batches of products are manufactured,
  2. process cost systems applicable when uniform and identical products are manufactured on a continuous basis.