SERVICE COSTINGOPERATING COSTING

Prepared by: Jessy Chong

Is the cost accounting method used in a business which provides a service, or in a service activity within any business to ascertain the cost of providing each unit of service.Service Industry

UtilitiesProfessionsTransportation BroadcastingHospitalsTheatresEducation

Service activities within businessCanteensTraining deptMaintenance deptPower generating deptCleaning deptStores

Cost per service unitCost per service unit = Total Operating Costs

Total Service Units

Pg 24(a) Benefits of cost accounting• Definition of cost accounting• COS, Cost/u, Valuation of Closing Inventory• Budgeting, Standard Costing, Variance Analysis

(b) Statistics Table (one decimal place)• Room occupancy (%) = Total no of rooms occupied x 100

Total no of rooms available

Bed Occupancy (%) = Total no of beds occupied x 100 Total no of beds available

Average guest rate ($) = Total Revenues Total no. of guests

Revenue Utilisation (%) = Actual Revenues x 100

Max. revenues from available rooms

Cleaning Cost per occupied room ($)= Cleaning Cost Total no. of rooms occupied

Average Cost per occupied bed ($)= Total Costs Total no. of bed occupied

(c) DefineCost unitCost centre

(d) Hotel service industryGive one example of cost centreGive one suitable cost unit for the example of cost centre