what is the impartence of secondary cost element in
controling, if it is needed give reasons
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Answer Posted / reshmi
Secondary elements r those which r not primary cost element directly related to gl a/c.]
For internal cost allocation purpose we use the secondary cost element the cost to allocate for to one cost center to another cost center.
like telephone is used by all the deptts in an office but to share the communication and telephone cost to all deptt (i.e admn,selling,finance) we need to allocate the cost on some basis...so this is the secondary cost element by which we allocate and settle the actual cost.
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