The Role of Costing in Materials Management in Manufacturing Companies

Abstract

This research work aims at examining the role which costing plays in materials management with a view to identifying the extent or the efficacy of J its application in quote manufacturing firms in Nigeria. To do this, survey method of research was utilized in carrying out the study. Both primary and secondary sources of data were used in gathering relevant information. The primary sources consist of the questionnaire and oral interview while the secondary data were gathered from existing literature on the subject matter of the study. For analytical reasons, the number of the sampled firms were bifurcated into high profit/earning ratio and low profit/earning ratio firms respectively. Tabular presentation of data analysis was used where by the effect and relationship one data has with another was quantified by simple percentage representation . The analysis revealed that most of the firms with low profit/earning ratios lacked the necessary strictness in the application of costing documents in materials management. The results of the two hypothesis tested in this study confirmed that loose application of costing methods and techniques seriously affect the profit capabilities of manufacturing firms. In view of the overwhelming importance of costing ~:! manufacturing firms, this research study tended to recommend that [a] Costing should be effectively used in materials handling in manufacturing concerns and [b] That the national assembly should enact a law establishing "The Nigerian Institute For Cost Accounting Practitioners