Scroll Top

search-icon
    drop-arrow

    Cost Center

    Introduction

    A cost centre is defined as a function or department within a company which is not directly going to generate revenues and profits to the company but is still incurring expenses to the company for its operations. The contributions made by the cost centres in terms of profits is indirect.

    It is very much, unlike a profit centre, whose actions will directly result in the profits to the company. The offices of the cost centres, like human resource executives and accountants, are given the responsibility of keeping the costs well below the budget allocated to them.

    Understanding Cost Center

    The operations of a cost centre will not directly result in profits to the company. However, their operation, such as customer service and enhancing product value, would help the company get more business. Cost centres will support the management in using the resources smartly by understanding how they are used in the company.

    Despite cost centres making contributions indirectly, one cannot ignore the revenues coming through them. Most associated advantages or the activities that produce profits from these wings of the company are generally ignored for the purpose of internal management.

    Functions

    The primary function of cost centres is to keep track of the expenses incurred. The managers or other high-level officials are given the responsibility of having the costs in sync with the allocated budget and will not be bearing responsibilities as to how the revenues generated to be used.

    The segmentation of expenses into cost centres will allow for a great level of control and analysis of the overall costs involved. Accounting resources at all levels will allow for more efficient calculation and accounting.

    Index

    Clear offers taxation & financial solutions to individuals, businesses, organizations & chartered accountants in India. Clear serves 1.5+ Million happy customers, 20000+ CAs & tax experts & 10000+ businesses across India.

    Efiling Income Tax Returns(ITR) is made easy with Clear platform. Just upload your form 16, claim your deductions and get your acknowledgment number online. You can efile income tax return on your income from salary, house property, capital gains, business & profession and income from other sources. Further you can also file TDS returns, generate Form-16, use our Tax Calculator software, claim HRA, check refund status and generate rent receipts for Income Tax Filing.

    CAs, experts and businesses can get GST ready with Clear GST software & certification course. Our GST Software helps CAs, tax experts & business to manage returns & invoices in an easy manner. Our Goods & Services Tax course includes tutorial videos, guides and expert assistance to help you in mastering Goods and Services Tax. Clear can also help you in getting your business registered for Goods & Services Tax Law.

    Save taxes with Clear by investing in tax saving mutual funds (ELSS) online. Our experts suggest the best funds and you can get high returns by investing directly or through SIP. Download Black by ClearTax App to file returns from your mobile phone.

    Cleartax is a product by Defmacro Software Pvt. Ltd.

    Company PolicyTerms of use

    ISO

    ISO 27001

    Data Center

    SSL

    SSL Certified Site

    128-bit encryption