TABLE OF CONTENTS
of the study
Scope of the
Plan of the
2.0 Literature framework
2.2 The role
of control in management
2.4 Cost accounting techniques as
an aid to management
2.5 The impact of breakeven point
analysis in management control
of Doyin investment Nigeria Limited
ANALYSIS AND INTERPRETATION OF DATA
CONCLUSION AND RECOMMENDATION
As a matter of fact, all aspect of accountancy has
arisen from practical necessity. Ever since the use of money to replace barter,
people have been concerned with costs.
However, it was the concentration of manufacturing facilities into
factories which gave impetus to the development of recognizable costing
In other word, cost accounting is probably the
field of accounting which has developed mostly within the half of this century
and there can be no doubt about its growing importance. This is partly a
reflection of the growing complexity of modern production methods, which result
in a greater capital investment and a higher proportion of competition widening
markets. All these factors necessitate the keeping of systematic and accurate
records which will show the cost of goods produced or contract fulfilled.
In summary whilst the early development were almost
entirely related to manufacturing concerns, nowadays costing is used very
widely indeed, in hospitals, transport undertakings, local authorities offices,
banks as well as in every manufacturing concern.
BACKGROUND OF THE STUDY
Ever since the use of money is used to replace
barter, people have been concerned with cost. As early as 4500BC in Mesopotamia, accounting documents such as stock inventories,
wages list and tax assessment were in use. It is true to say that accounting
methods have always reflected the degree of sophistication of the economic
circumstances in which they were used.
By the end of middle ages, the main use of
accounting method was by government in assessing settlements and individuals
for taxation purpose. From the last 13th century awards, there was a
tremendous increase in trading activity in Europe.
The existing rudimentary methods of accounting were not sufficient to deal
effectively with the many transactions that took place.
Cost accounting provides key data to managers for
planning and controlling, as well as costing products and services, and cost
accountant are increasingly becoming integral members of decision making teams
instead of just data providers. Modern cost accounting provides information to
managers for their decision making. It cuts across all facts of the
organization which gives insight into both the manager’s roles and the
accountant’s roles. It measures and reports financial and non financial
information that relates to the costs of acquiring consuming resources by an
1.2 STATEMENT OF THE PROBLEM
accounting methods established in any organization do have some constraints
that militate against its objectives despite its indispensability. When new
costing system is introduced either in part of production control or either
function employers may resent the system. This ensures if they were not
consulted before the system is employed or just as a result of more hostilities
been argued that cost accounting means spending money which will both produce
tangible benefit. The cost of installing costing system tends to be high and
those of operation even higher.
in modern times there is recognition that efficient production requires
planning and control. Workers often expect the result of a newly introduced
system too soon. Once their expectations are not met, they tend to give up on
the system and will not be ready to cooperate on the next trail. Some
manufacturing industries in Nigeria
do not recognize the value of cost accounting and take it as a more time
wasting and do not create a department for it.
1.3 OBJECTIVE OF THE STUDY
The main purpose of the study is to evaluate cost
accounting techniques as it aid management control.
Management has an important role to play in
ensuring that the organization is kept solvent through it control measures as in
ascertaining the better price for its goods and services, ensuring that the
desired volume of production is secured at the last possible cost in relation
to the schedules quality of the product etc.
measurement of the degree of which these objectives attained depends largely on
the existence and effectiveness of the cost accounting system in the
1.4 SIGNIFICANCE OF THE STUDY
research work will help in widening the researcher’s knowledge of the
application of cost accounting techniques in an organization for effective
management control. This research work will as well add to the existing
knowledge on this topic.
study will also enhance the appreciation to cost accounting techniques as an
effective tool for management control in manufacturing industries having taken
DOYIN INVESTMENT NIGERIA LIMITED as case study and will also enable the readers
to appreciate the importance of cost accounting system in any organization
1.5 SCOPE OF THE STUDY
research work covers a wide range of selected textbooks and other materials as
regards the topic particular reference to DOYIN INVESTMENT NIGERIA LIMITED.
study covers the role of material control in the company and the various raw
materials used for its product. How efficient is the company in the adequate
use of raw materials?
the operation of the company’s budget was also examined. Most importantly is
the examination of the company’s standard costing in the effective management control?
study also covers the aid of accounting technique as an effective means for
management control in the company.
1.6 RESEARCH METHODOLOGY
achieve the objective of this study evaluation of the trading activities of
Doyin Investment Nigeria Limited and appraisal of the listing requirement are
very important. The examination would be based strictly on the Doyin Investment
study will also examine the performance of the manufacturing on the area of all
1.7 RESEARCH QUESTION\HYPOTHESIS
researcher used both the primary source of information and the secondary source
of information to gather the information required for the study.
primary information is obtained from the case study. The personnel manager is interviewed
and questionnaire was given out to be filled by some of the key officers of the
company to gather information on the cost accounting existence and system in
the company .The information gathered through the questionnaire is analyzed in
chapter four using percentage method.
1.8 PLAN OF THE STUDY
one deals with the background of the study. It introduces the readers to the
topic. It discusses the statements of the problem and highlights the purpose of
the study. The scope of the study is also discussed in the chapter as well as
the research question.
two incorporates the literature review of the subject matter and analysis of
the importance of cost accounting for effective management control. References
are made in this chapter from textbook which will help in testing the
researchers finding in chapter four.
three gives brief historical background of the Doyin Investment Nigeria Limited
as well as data collection method, sample selection, questionnaire design and
data processing techniques.
four deals with the facts obtained from the investigation analysis of the
issues involved in the subject matter are embodied in the chapter. This chapter
however proves the test of the researcher’s findings.
five deals with the summary, conclusion and recommendation with references.
1.9 DEFINITION OF TERMS
COST ACCOUNTING: According to ICMA, it is defined as the
establishment of budget ,standard cost
and actual costs of operations, process, activities or product and the
analysis of variance, profitability or the social use of fund
COSTING: According to ICMA, it is the technique or process
of ascertaining cost.
COST: is defined as the amount of expenditure
actual/national incurred on or attributable to a specified thing or activity.
COST UNIT: According to
the institute of cost and management accounting ICMA, It is “a quantitative
unit of product or services in relation which cost is ascertained”.
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