1、中文3380字，1740单词，10100英文字符 Reference for business,Encyclopedia of Business.2nd ed,Cos Des Cost control Roger J. Binder Abstract Cost control, also known as cost management or cost containment, is a broad set of cost accounting methods and management techniques with the common goal of improving b
2、usiness cost-efficiency by reducing costs, or at least restricting their rate of growth. Businesses use cost control methods to monitor, evaluate, and ultimately enhance the efficiency of specific areas, such as departments, divisions, or product lines, within their operations. Control of the busine
3、ss entity, then, is essentially a managerial and supervisory function. Control consists of those actions necessary to assure that the entity's resources and operations are focused on attaining established objectives, goals and plans. Control, exercised continuously, flags potential problems so t
4、hat crises may be prevented. It also standardizes the quality and quantity of output, and provides managers with objective information about employee performance. Management compares actual performance to predetermined standards and takes action when necessary to correct variances from the standards
5、. Keywords: Cost control； Applications； Control reports； Standards； Strategic Cost control, also known as cost management or cost containment, is a broad set of cost accounting methods and management techniques with the common goal of improving business cost-efficiency by reducing costs
6、, or at least restricting their rate of growth. Businesses use cost control methods to monitor, evaluate, and ultimately enhance the efficiency of specific areas, such as departments, divisions, or product lines, within their operations. During the 1990s cost control initiatives received paramount a
7、ttention from corporate America. Often taking the form of corporate restructuring, divestment of peripheral activities, mass layoffs, or outsourcing, cost control strategies were seen as necessary to preserve or boost corporate profits and to maintain or gain a competitive advantage. The objective w
8、as often to be the low-cost producer in a given industry, which would typically allow the company to take a greater profit per unit of sales than its competitors at a given price level. Some cost control proponents believe that such strategic cost-cutting must be planned carefully, as not all
9、cost reduction techniques yield the same benefits. In a notable late 1990s example, chief executive Albert J. Dunlap, nicknamed "Chainsaw Al" because of his penchant for deep cost cutting at the companies he headed, failed to restore the ailing small appliance maker Sunbeam Corporation to
10、profitability despite his drastic cost reduction tactics. Dunlap laid off thousands of workers and sold off business units, but made little contribution to Sunbeam's competitive position or share price in his two years as CEO. Consequently, in 1998 Sunbeam's board fired Dunlap, having lost c
11、onfidence in his "one-trick" approach to management. COST CONTROL APPLICATIONS A complex business requires frequent information about operations in order to plan for the future, to control present activities, and to evaluate the past performance of managers, employees, and rela
12、ted business segments. To be successful, management guides the activities of its people in the operations of the business according to pre-established goals and objectives. Management's guidance takes two forms of control: (1) the management and supervision of behavior, and (2) the evaluation of
13、 performance. Behavioral management deals with the attitudes and actions of employees. While employee behavior ultimately impacts on success, behavioral management involves certain issues and assumptions not applicable to accounting's control function. On the other hand, performance evalua
14、tion measures outcomes of employee's actions by comparing the actual results of business outcomes to predetermined standards of success. In this way management identifies the strengths it needs to maximize, and the weaknesses it seeks to rectify. This process of evaluation and remedy is called c
15、ost control. Cost control is a continuous process that begins with the proposed annual budget. The budget helps: (1) to organize and coordinate production, and the selling, distribution, service, and administrative functions； and (2) to take maximum advantage of available opportunities. As the
16、 fiscal year progresses, management compares actual results with those projected in the budget and incorporates into the new plan the lessons learned from its evaluation of current operations. Control refers to management's effort to influence the actions of individuals who are responsible
17、 for performing tasks, incurring costs, and generating revenues. Management is a two-phased process: planning refers to the way that management plans and wants people to perform, while control refers to the procedures employed to determine whether actual performance complies with these plans. Throug
18、h the budget process and accounting control, management establishes overall company objectives, defines the centers of responsibility, determines specific objectives for each responsibility center, and designs procedures and standards for reporting and evaluation. A budget segments the busines
19、s into its components or centers where the responsible party initiates and controls action. Responsibility centers represent applicable organizational units, functions, departments, and divisions. Generally a single individual heads the responsibility center exercising substantial, if not complete,
20、control over the activities of people or processes within the center and controlling the results of their activity. Cost centers are accountable only for expenses, that is, they do not generate revenue. Examples include accounting departments, human resources departments, and similar areas of the bu
21、siness that provide internal services. Profit centers accept responsibility for both revenue and expenses. For example, a product line or an autonomous business unit might be considered profit centers. If the profit center has its own assets, it may also be considered an investment center, for which
22、 returns on investment can be determined. The use of responsibility centers allows management to design control reports to pinpoint accountability, thus aiding in profit planning. A budget also sets standards to indicate the level of activity expected from each responsible person or decision unit, and the amount of resources that a responsible party should use in achieving that level of activity. A budget establishes the
