University of ballarat |
BUACC 5933 Cost and Management Accounting |
Assignment Topic 2: The Costing of Services |
30109520 Xiechong Liu; 30106429 Guang Yang |
This essay is aim to explore how important of the cost accounting information for the service organization to achieve their success. Providing the reason why the managers of service company need the information of cost of service, and demonstrate how difficult for the service organizations to calculate their service costs.
1. Introduction 4
2. Why the managers require information on the cost of the services which it provides the in service organisation 4
1) Planning and budgeting 4
2) Pricing 4
3) Measurement and evaluating 5
4) Decision Making 5
5) Organizing Management and Control 5
3. Difficulties may arise in calculating service costs. 6
1) Highly relying on information systems cause difficulty of calculating costs 6
2) Calculating cost in service economy VS production industry 6
3) Different aspects of difficulties in service economy 7
4. Conclusion 7
Providing the cost of service is a significant issue for the service organizations. The information is helpful for the service business to achieve their success. This essay will explain why the managers of company which provide service need the information of cost of service, and demonstrate the difficulties for this kind of business to calculate such costs.
2. Why the managers require information on the cost of the services which it provides the in service organisation
Service is a kind of product which service organisations “produce” to meet the need of their customers (Lovelock, Patterson and Wirtz, 2012). So that, the managers of the service company also need the information to manage and direct their company like what the managers have done in the manufacture organisations. And, the cost of their...