Cost accounting is used for two main purposes

Description

Cost accounting is used for two main purposes. The first purpose is to determine the actual costs of products, projects, processes, or services so an organization can report correct and accurate information on their financial statements. The second purpose is to aid the management team in making decisions and guiding the planning and control functions of the organization. Cost accounting provides an analysis of cost behavior, cost-volume-profit relationships, budgeting, resource costing, and activitybased costing. The roots of cost accounting are in the manufacturing business, but cost-accounting concepts are also used in service industries.

This assessment focuses on the SRS Educational Supply Company case study. SRS is a company that provides materials and supplies to educational institutions. The SRS business model is to be a one-stop provider of educational supply needs. For example, some of their product lines include workbooks, classroom visual aids, instructor support materials, art supplies, lab supplies, and administrative office supplies. While SRS serves all levels of educational institutions, the majority of their customers are K12 schools. Sales can vary quite a bit from month to month, as K-12 educational institutions have seasonal ordering patterns. Thus, budgeting is vital for planning and cash flow purposes. SRS has a June 30th fiscal year end.

The final project is divided into two parts. In Final Project II, you will review the financial information provided for the four main departments of the organization: sales, purchasing, operations, and finance. Based on the information provided, you will create departmental budgets for each of the four departments. You will then create a master budget based on the department budgets. In addition, you will create an executive brief presentation regarding the budgeting process. You will also provide an overview of the department and master budgets