This research aims to determine the application of responsibility accounting in controlling costs. Responsibility accounting plays an important role in controlling company cost. The most important element of every organization is “people” as they can easily influence the other elements (technology, goals, tasks etc).

Every organization is a social system or social unit. A system may be defined as an entity consisting of a number of interrelated and interdependent components of parts which are generally known as subsystem. One of the important features of organization is that it is always engaged in goal directed activities. Like other organization business organization are also engaged in goal directed activities.

In every organization there are a number of managers in various levels of management. They perform jointly to fulfill their organizational objectives. Every manager has particularly responsibilities. They worked under the supervision of top management to fulfill their individual responsibilities. The overall success of the organization largely depends upon the fulfillment of the responsibilities of the managers.