Objective of using Standard Costing System in controlling
- To control costs mainly by setting standards for each type of
cost incurred material, labour and overhead.
- It also help in analysing Variances and hence judging the
effectiveness of managers in controlling cost which they are held
- It is a tool for planning budgets, managing and controlling
costs and evaluating cost management performance.
- To assign per unit cost to production
- To measure and evaluate the use of production capacity with
respect to the incurrence of fixed overhead cost.