An Assessment of Cost Accounting Practice in Case of Zebidar Beer Factory

Abstract

The purpose of this thesis is to assess cost accounting practices in control and reducing in manufacturing cost at Zebidar beery Factory. It looks through the company’smanagement support, employees’ involvement, arrangement of cost and responsibility centers,tools and techniques of cost control and reduction, cost classification and allocation, methods ofcosting and its implementation, purchasing procedures and finally the use of cost information ofthe company’s data were collected through questionnaire and interview. The data were gathered through a combination of both unstructured interviews with the department head and questionnaire addressed to the employees of the organization. The data received were analyzed by using narration and descriptive statistics. The finding of the research revealed that the company does not give chance for employees to participate in budget preparation and standard setting, it does not use target costing as cost control and reduction tools and techniques and reporting without relating of actual and planned information. Lack of assign costs to particular cost objects and each cost object has not separate measurement of cost, return back to store andinform the costing department when it has excess raw materials, use only traditional costing method and giving cost information for external users are other problems that found out in the study. So in light of the above problems, the following recommendations were forwarded. The company should try to include employees in budget preparation and standard setting, try to use target costing, and relate actual with planned information in reporting. It should also assign costs to particular cost objects and each cost object has separate measurement, return back to store and inform the costing department when it has excess raw materials, try to use modern costing method and in time of need give cost information for external users. cost