Effectiveness Of Standard Costing As A Control Tool For Performance Evaluation In Manufacturing Industries

EFFECTIVENESS OF STANDARD COSTING AS A CONTROL TOOL FOR PERFORMANCE EVALUATION IN MANUFACTURING INDUSTRIES

Abstract

Basically, an effective control of production costs could point the way toward more efficient production of goods and services. In an economy with a high rate of inflation and where prices of goods and services are constantly rising with no hope of a reduction, the study of standard costing as a tool for production cost control is extremely important, especially since this has the effect of making the real value of money in consumers’ hands lower than its face value. Due to the fact that they have limited funds, consumers may prioritize purchasing things that are more affordable when compared to similar-quality alternatives. With reference to the Anambra Motor Manufacturing Company (ANAMMCO) in Enugu, this study examined the effectiveness of stand costing in the control of production costs and performance evaluation. The researcher has the opinion that the organization must produce at a lower cost while maintaining a constant level of quality for customer satisfaction in order to achieve one of its aims. It must set up procedures for efficiently tracking and regulating production costs. One way of doing this is through standard costing. In conclusion, chapter one of this project demonstrated the backdrop of the study, the statement of the problem, the target of the investigation, and the significance of the study in order to achieve this goal.