TRAFFIC COSTING - TECHNIQUES OF TRAFFIC COSTING

TECHNIQUES OF TRAFFIC COSTING

Direct – bifurcation of expenses between different gauges, coaching and goods services

Indirect – assessment through

1.     Engineering Analysis based on experience and knowledge of engineers- ratios for apportionment of traffic maintenance, expenditure, repairs & maintenance of locomotives

2.   Statistical Analysis used for apportionment of common costs through survey method – ratios based on sample survey in S Railway 1986 and 1995 statistical regression analysis based on correlation analysis simple and multiple regression analysis –more than one independent correlated or regressed with the dependent variable. Simple one dependent variable correlated with one independent variable

3.     Percent Variable Method – proportionate distribution of joint costs in relation to the direct cost to total expenses

4.     Ratio Of Direct Expenses – the ratio of direct expenses of different services

5.  Cost Accountant’s Method – based on the behavior of different elements of cost by a study of employee duty hours machine hours, and other factors required for producing passenger and goods services.