What Are the Functions of a Cost Center in a Management Accounting System?
business woman at desk #16 image by Adam Borkowski from Fotolia.com jQuery(document).ready(function(){ jQuery(‘#jsArticleStep1 span.image a:first’).attr(‘href’,’http://i.ehow.com/images/a06/f5/04/functions-center-management-accounting-system_-1.1-800X800.jpg’); }); A cost center is part of a good management accounting system. A cost center in a management accounting system analyzes the company’s budgets. A cost center is responsible for examining budgets to find problematic areas and suggest improvements. Many medium-sized and large organizations have a cost center as part of their management accounting system. Budgeting A cost center’s primary job is comparing actual amounts of costs spent to amounts allotted for in the budget. This is done by using budget performance reports to compare with actual budgets. The cost center is not responsible for creating a budget, only analyzing it. This part of management accounting is focused on only the internal aspects of the company. A company’s
