THE ROLE OF COST ACCOUNTING IN SMALL SCALE BUSINESSESIN KOGI STATE (A STUDY OF LIMS BREAD INDUSTRY, IDAH KOGI STATE)

This study examined the role of cost accounting in small-scale businesses, with particular reference to Limes Bread Industry, Idah, Kogi State. The study aimed to investigate the extent to which cost of inventories influences return on assets, assess the degree to which cost of labour affects return on equity, and determine the combined impact of cost of sales/distribution, cost of labour, and cost of inventories on the size of the organization. Secondary data covering a fiveyear period (2019–2023) were obtained from the company’s financial statements. The data were analyzed using descriptive statistics, correlation analysis, and multiple regression techniques. Findings revealed that cost of inventories has a positive and significant effect on return on assets, indicating that efficient inventory management contributes to asset utilization. Cost of labour showed a positive but moderate effect on return on equity, suggesting that optimal labour cost management can enhance shareholders’ returns. Furthermore, the joint influence of cost of sales/distribution, cost of labour, and cost of inventories was found to be substantial in explaining changes in the size of the organization. The study concluded that effective cost accounting practices are essential for improving profitability and ensuring sustainable growth in small-scale businesses. It recommended that small-scale businesses, particularly in the bakery sector, adopt proper cost control measures, maintain accurate cost records, and continuously monitor cost drivers to enhance performance and competitiveness.