what does cost accountant do
A Cost Accountant is hired by a company with an objective of reduction of a company’s financial costs and increasing profits. Roles of a Cost accountant include determining actual costs of manufacturing or providing a service, scrutinizing associated company expenses, examining profitability, and preparing the company budget. To effectively achieve financial objectives, Cost Accountants are required to work closely with management. Cost accountants are expected to be familiar with all of the methods of cost accounting and their associated software programs.
There are 4 types of cost accounting methods out of Cost accountants may specialize in one or more of them:
1. Standard costing- systems assign the average cost to every direct expense, such as labor, materials, and overhead, that is associated with each product.
2. Activity-based costing- determines the fixed and variable costs by comparing the direct costs associated with specific product lines.
3. Throughput accounting- concentrates on increasing efficiency through minimizing process and production bottlenecks in order to maximize output.
4. cost-volume-profit (CVP) analysis- ascertains the variable and total fixed costs in accordance with the quantity level of products.