COST ACCOUNTING SYSTEM DEVELOPMENT PROPOSAL Essay

COST ACCOUNTING SYSTEM DEVELOPMENT PROPOSAL - Essay Example In order that the costing system is effective so as to support the management control systems, a consideration of various financial and non-financial performance measures is undertaken to introduce the costing systems. This so because the functions of the management control systems is not only to collect the information but also to act upon an analysis of such data and information to steer the organization towards success. Hence arises the need for these performance measures. Some organizations present financial and non-financial performance measures for their subunits in a single report called the Balanced Scorecard. Different organizations stress different elements in their scorecards, but most scorecards include Considering the incorporation of the financial and non-financial measures in the management control systems, an Activity Based Costing system (ABC) would be appropriate for the new online company as well as the existing merchandising division of the company. Activity based costing systems refine costing systems by focusing on individual activities as the fundamental cost objects. An activity is an event, task, or unit of work with a specified purpose; for example designing, setting up machines, distribution.