Question

Uniform costing is used as a decision making tool.

Answer 1

Uniform costing refers to the use of the same costing principles and practices by several undertakings. These undertakings may or may not be under the same management. ... Uniform costing helps member firms to adopt one of the best methods of cost accounting system known to the industry.O

Answer 2

Uniform costing is used as a decision-making tool because:-

• Uniform costing pertains to a network of costing under which various efforts use similar costing principles or practices.
• It is an established system using agreed theories, laws and basic accounting methods adopted by various entities in the identical industry to assure that they all handle accounting information in a like way, the accuracy being to stimulate inter-firm comparison.
• The most significant characteristic of uniform costing is that whatever may be the technique of verifying cost, it is approved uniformly in a number of undertakings in the identical industry or even in distinct industries.
• This facilitates the member undertakings to obtain the cost and accounting data on a comparative explanation which eventually may be valuable and useful to the management for putting up with significant decisions.

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