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CMA Foundation · Fundamentals of Financial and Cost Accounting · Meaning and Significance of Cost Accounting and its Relationship with Financial Accounting

Which of the following is a scope or function of cost accounting rather than of financial accounting?

Cost ascertainment and cost control through cost centres belong to cost accounting. Preparing the Balance Sheet, recording share capital and filing income tax returns are financial accounting or statutory compliance activities, so they are not the scope of cost accounting.

  1. ACost ascertainment and cost control by cost centresCorrect
  2. BPreparation of the Balance Sheet in Schedule III format
  3. CRecording of share capital issued by a company
  4. DFiling of income tax returns by the assessee

Explanation

Cost ascertainment and cost control by cost centres are core cost accounting functions. The other three are financial accounting or statutory compliance matters.

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