The Role of Cost Accounting in Transport Management in Uganda Railway Corporation .

ABSTRACT
This  research was on to  obtain  the  major  purpose of instituting cost accounting system that will guide management of the transport department in an organization. It was conducted in Uganda Railway Corporation. The  researcher  was  interested  in  this  topic  because  usually  managers  are handicapped in  making prompt decision  s for  transport department clue to  lack of accurate analysis of behaviours of the costs relating to the operation of the transport service. During the  process of conducting this  research,  it  was  realized that there is an urgent need to integrate a clearly defined costing system into the existing financial accounting system Some of the recommendations made  by the  researcher in this  report  included the need  to  strengthen the  cost accounting system as an integral  part of the  existing financial  accounting system,  for  the purpose of cost  control,  integrate  the  departmental transactions. into a line of authorization and management being committed to  discipline  of  cost  control,  there  should be company  y  wide  cost-profit awareness. The study was  carried· out as  a result of the fact  that the  researcher expected the role of cost accounting to improve on the management to confine the known cost-profit facts to  a select few who need to  know than fewer people will be committed to cost management.

TABLE OF CONTENTS

DECLARATION ................................................................................................................. i

APPROVAL ....................................................................................................................... ii

DEDICATION·································································•··········•···•··························· .... Ill

ACKNOWLEDGEMENT ........................................................................................ Iv

LIST OF TABLES AND ILLUSTRATIONS .............................................................. v

TABLE OF CONTENTS ................................................................................................ VI

ABSTRACT ........................ : ........................................................................................... Vlll

CHAPTER ONE ................................................................................................................. 1

l .O. Introduction ......................................................................................................... 1

1 . l . Background.......................................................................................... . ......... I

1.2. Staten1ent of the proble111 .... ..... ........................... ....... .... ........... .. ... .. ... '

1.2.4. Significance and purpose of the study........................................ 7

1.2.2. I-Iypotl1esis.................................................................................... . 3

1.2.3. Objectiws of the study ............................................................................... 4

CHAPTER TWO (II).. ...................... .. . . ... .... .. ..... .. .. ... . ...................................... 5

LITERATURE REVrEW· .............................................................................. •·············· 8

3.0. Introduction ........................................................................................................ 8

3.1. A theoretical frame work ................................................................................ 8

3.2. Costing in transport management ................................................................ l O

3.3. lnstalling a cost accounting system ......................................................... I 0

CHAPTER THREE (III) ................................................................................... 8

METHODOLOGY ............................................................................................................. 5

2.0. Introduction ......................................................................................................... 5

2. l. Research Design ........................................................................................ , ....... 5

2.2. Methods of data collection .................................................................................. 5

2.3. Types of data collected ....................................................................................... 5

2.4. Sources of data .................................................................................................... 5

2.5. Data processing ................................................................................................... 6

2.6. Data processing and analysis .............................................................................. 6

2.7. Data analysis and presentation ............................................................................ 6

2.8 Limitations anticipated and problem ···6

CHAPTER FOUR .......................................................................................................... 12

PRESENTATION OF FINDINGS ............................................................................... 12

4.0. Introduction ...................................................................................................... 12

4. l. Company-Uganda railway corporation ............................................................. 12

4.1.1. What is Uganda Railway Corporation? .................................................... 12

4.1.2. Objectives of the study .............................................................................. 12

4.1.3. Authority of Uganda Railway Corporation ............................................... 13

4.1.4. Location of Uganda Railway Corporation ................................................ 14

4.1.5. Historical background of Uganda Railway Corporation ...................... I 5

4.1.6. Changes ..................................................................................................... 16

4.1.7. Membership and international links .......................................................... 16

4.1.8. Block trains bulk haulage ........................................................................ 17

4.1.9. Shipping ................................................................................................... 18

4.1.10. Warehousing facilities ........................................................................... 18

4.1.11. The future of Uganda Railway Corporation .......................................... 19

4.2. The department organization .......................................................................... l 9

4.3. The transport service transaction ...................................................................... 21

4.4. The problem of incomplete recording ........................................................... 22

4.5. The purchasing procedure ................................................................................. 23

4.6. The problem area in the purchasing routine ................................................. 24

4.7. Receipt of good at stores ................................................................................... 25

4. 7 .1. Stores upkeep ............................................................................................ 25

4.7.2. Movement of supplies out of stores .......................................................... 25

4.7.3. Problems faced in storekeeping .......................................................... , ... 26

4.8. Wage routine .................................................................................................. 26

4.9. Time recording .................................................................................................. 26

4.9.1. Time basis of remuneration ..................................................................... 27

4.9.2. Idle time .................................................................................................... 27

4.10. The piece work system ..................................................................................... 27

4.10.1. Direct expenses ......................................................................................... 28

4.11 Costing the transport service ............................................................................. 28

4.11. 1. Introduction ................................................................................................... 28

4.11.2. Fuel costs .................................................................................................. 29

Staff costs ........................................................................................................................... 29 0

4.11.3 Among lixed costs, are the following costs ....................................... 30

4.12. Fixing the tariff ( rail transport) ..................................................................... 3 0

4.13. Other factors considered in rate fixing ......................................................... 33

4.14. Estimating for the entire department using the higl1 low cost method ......... 34

4.15. Using cost data for planning profit levels cost volume profit analysis ......... 35

-L 16. The contribution margin at transport department ..................................... 3 5

4.17. The break even analysis ........................................................................... 38

4.18. Profit planning for the department.. .......................................................... 40

4.19. Using cos.t data for performance evaluation ............................................. 41

4.19 .1. The cost centre system as a management ........................................... : ..... 41

4.19.2. Cost centre system and budgets ................................................................ 41

4.19.3. Budgeting at transport department.. ........................................................ 41

4.19.4. Summary ...................................................................................................... 43

CHAPTER FIVE .............................................................................................................. 45

5.1. Strength sited in the routine .............................................................................. 45

5.2. Problems actual and potential in routine ........................................................... 46

5.3. Recommendations ............................................................................................. 47

BIBLIOGRAPHY ............................................................................................................. 49

APPENDIX ......................... : ............................................................................................. 52