Page 29 - Cost Accounting - Ready Reckoner
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CHAPTER – 08
Operating Costing
Operating Costing is a method of costing followed by service sector to charge a
price for the services rendered.
Eg: Fare per passenger for travel. Hotel room accommodation fare. Charges for a
bed in hospital. Fees from every student to be charged by an educational institution.
Although the above mentioned examples are service sectors, their primary motive being
service, still they add a margin to costs to determine the fare for services rendered.
Such fare for services is determined by preparing an Operating Cost Sheet,
adding a margin to total cost.
