Managements efforts to achieve company objectives rest upon the twinfunctions of planning and control. The planning function is essentially a deci-sion-making process dealing with the establishment of a desired profit; thepreparation and availability of materials, labor force, and plant and equipmentfor the anticipated volume; and the creation of a communication system thatpermits reporting and controlling actual results against predetermined plans.The control function deals with managements task of organizing and marshal-ing natural forces, human behavior, and material objects into a coordinatedunit in order to attain the desired results. The connecting link between theoriginating planning function and the terminating control function is the costaccounting information system that permits effective communication, contin-uous feedback, responsibility accounting, and managerial flexibility. Moderncost accounting is rightly termed a tool of management, with emphasis onmanagement. The processing and reporting of a firms historical and projectedmicroeconomicdata assist management in developing new potentials, improv-ing present opportunities, establishing more aggressive yet flexible control of operations, and enhancing the management process through objective evalua-tion of the feedback data.

The importance of cost accounting to the performance and success of anylevel of management in both problem identification and problem solving isemphasized throughout the Sixth Edition. While planning is essentially a deci-sion-making activity, control intends to ensure realization of the plannersgoals. Although the information and underlying data required for these twofunctions are often quite different, one expects the cost accounting system toprovide the answers and respond to the needs of both functions. This dualresponsibility of the cost accounting information system to both functionsstrongly influenced the authors in structuring the presentation followed in this textbook.