Description

This unit examines how cost information is generated and used in organisations for decision-making purposes. To this end a number of different costing and budgeting techniques are explained, and demonstrated. In addition the appropriateness of the various techniques is explained, which depends partly on the business situation and partly on the decisions that are made with the information. There are three main parts to the unit: (i) costing techniques (job/process costing and cost allocations); (ii) budget setting and evaluating performance against the budget; and (iii) using costs for decision-making.