ABSTRACT
Current user cost would be the cost of primary concern to the accountant in carrying out his function for the firm and for the world at large. Once the performance has been measured, then the accountant, in conjunction with cost engineers, business planners, or what not, can go ahead and help to assess how to modify the existing or present plan of operation, or support the firm in adopting a new one. The gently rising material costs and sharply rising fixed asset costs not only involve rising operating costs, when measured in terms of current prices to make them comparable to other items on the income statement, but also involve holding gains, or preferably we may term them cost savings. Current user cost, or the current replacement cost of assets the firm has, in fact, chosen to employ in its plan of operation would be the relevant data to match against current revenues to measure the relative success or failure.
