The main uses of cost accounting as follows:

1. Helps in Ascertainment of Cost: Cost Accounting helps in the ascertainment of cost of each product, process, job, contract, activity etc. by using different methods of costing such as Job Costing and Process Costing.

2. Helps in Control of Cost: It helps in the control of material costs, labour costs and overheads by using different techniques of control such as Standard Costing and Budgetary Control.

3. Helps in Decision making: It helps the management in making various decisions such as –

(a) Whether to make or buy a component

(b) Whether to retain or replace an existing machine

(c) Whether to process further or not

(d) Whether to shut down or continue operations

(e) Whether to accept orders below cost or not

(f) Whether to expand or not

(g) How much reduction in the selling price should be made in case of depression?

4. Helps in fixing Selling Prices: It helps the management in fixing selling prices of products or services by providing detailed cost information.

5. Helps in Inventory Control: It helps in inventory by using various techniques such as ABC analysis, Economic Order Quantity, Stock levels, Perpetual Inventory system and Continuous Stock Taking, Inventory Turnover Ratio etc.

6. Helps in Cost reduction: It helps in the introduction of cost reduction programme and finding out new and improved method to reduce costs.

7. Helps in measurements of Efficiency: It helps in measurements of efficiency of operations through establishment of standards and variance analysis.

8. Helps in preparation of Budgets: It helps in the preparation of various budgets such as Sales Budget, Production Budget, Purchase Budget, Man-Power Budget, Overheads budget.

9. Helps in identifying Unprofitable Activities: It helps in identifying unprofitable activities so that the necessary