Cost Control: A Fundamental Tool towards Organisation Performance
Received Date: May 23, 2018 / Accepted Date: Jun 27, 2018 / Published Date: Jul 09, 2018
The study aimed at establishing the effect of cost control on organisation performance with a case study of Mount Elgon Millers Limited. The objectives of the study where; to assess the effect of budgeting on organisation performance in MEM Ltd, to examine the effect of standard costing on organisation performance in MEM Ltd and to determine the relationship between cost control and organisation performance in MEM Ltd.
The study used a case study design where both quantitative and qualitative approaches were used, primary and secondary data was collected using document review, questionnaires and interviews, and it involved a population of 80 and a sample size of 67, simple and purposive sampling techniques were used. The instruments used were pretested and given to fellow researcher experts to comment on the validity and reliability of the question concept and content. The data collected from the field was edited, coded and categorized into themes, and then it was analyzed using the Statistics Package for Social Sciences (SPSS).
The study findings on the effect of budgeting on organisation performance indicated that budgeting explains the variation in the organization performance up to 8.5% as denoted by R2 value (0.085) and the remaining 91.5% is attributed to other factors other than budgeting. The study findings on the effect of standard costing on organisation performance indicated that standard costing explains the variation in the in organization performance up to 5.8% as denoted by R2 value (0.058) and the remaining 94.2% is attributed to other factors other than standard costing. According to the study findings on the relationship between cost control and organisation performance, it was evident that there exists a significant and strong positive relationship between cost control and organization performance where (r=0.425, p<0.01).
Conclusively, It can be out rightly pointed basing on the findings of this research that the application of cost control has greater effects on organisation performance and that the principles of cost control and its techniques such as budgeting and standard costing are being adopted and practiced in Mount Elgon Millers Limited as an aid in the decision making process of the management.
Keywords: Cost control; Standard costing; Budgeting and organization performance
Citation: Mutya T (2018) Cost Control: A Fundamental Tool towards Organisation Performance. J Account Mark 7: 283. Doi: 10.4172/2168-9601.1000283
Copyright: © 2018 Mutya T. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
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