What is the meaning of cost centres and cost categories in tally give answer with example
thanks in advance
V P Narasimhan
(Accounts Manager)
(791 Points)
Replied 19 April 2009
Cost Centre is nothing but allocation of expenses department wise viz., Manufacturing,Sales/Marketing,Administrative,Finance as detailed below:
Expenses - ! Related Cost Cntre
Production Exp !
Wages & expenses related to ! Manufacturing
Manufactruing
So also for other related expenses relating to each catogery/department.
Advantage: To prepare the Budget for the Next year (department wise) . To facilitate Cost Control. To analyse department wise expenses to review periodically & monitor the expenses before finalisation.
For example even for Branches also can be treated as cost centre viz., Branch A,B and so on & the whole expenses can be reviewed and each Branch's performance can also be ascertained & audited.
Landmark Judgments: Important Provisions of the EPF & ESI Act interpreted by the Honorable Supreme Court of India
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