...Introduction According to Chand (2015), costing techniques are used by management for controlling cost and making managerial decisions. It systematically records expenses and analyses the cost of each product manufactured or service rendered by an organisation (Hariharan, n.d.). Firms choose to adapt to a specific costing theory that caters accordingly to their needs and objectives. Part 1: Evaluation of Costing Theories Costing theories are very important in business decision making. According to Hariharan (n.d.), they serve managers as a guide to make correct decisions such as what price to quote, whether to place order for inputs or whether to abandon or add a product to the production line. Costing theories also determines the price of the best alternative use of a factor of production and results in an efficient allocation of resources (Chand, 2015). The business will adopt the most profitable production inputs by identifying unprofitable activities, losses and inefficiencies (Chand, 2015) Costing theories also helps the decisions regarding the capital expenditure through the estimation of long-run function (Chand, 2015). This function will be useful to managers when deciding on the expansion or contraction of plant size in the firm and confirming that the present plant size is just nice for the output level that is being produced (Chand, 2015). It improves the overall productivity of an organisation and acts as an important guide in bringing prosperity to the firm (Vitez...
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...Characteristics of Management Accountants Aileen Davey Adrian France* *Waikato Institute of Technology (Wintec) Tristram Street Private Bag 3036 Hamilton 2020 New Zealand Telephone: (07) 8348800 ext 8519 Fax: (07) 8348802 Email: Adrian.france@wintec.ac.nz Abstract In New Zealand there have been a number of articles about the changing profile of accountants in today’s environment. Recent debate is focusing on the goal congruence of educators and practitioners. Professional accounting bodies are also identifying the changing needs of the accounting professionals’ skill sets as a key area of future focus irrespective of what job title the accounting professionals operates under. This paper seeks to identify the key skills and characteristics of management accountants which are being looked for by employers in today’s market. Situations vacant for management accountants were surveyed. The results indicated that communication skills were advertised the most frequently, marginally ahead of technical skills. Of the Characteristics leadership was most frequently advertised. The survey in this paper confirmed the practitioners actions in situations vacant advertising are congruent with their requirements profiled as essential skills in potential employees, today’s students. Keywords: Skills, characteristics, management accountant, situations vacant, advertising. Advertised Skills and Characteristics of Management Accountants ...
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...labor. Direct labor cost is wages that are incurred in order to produce specific goods or provide specific services to customers. It also includes the payroll taxes associated with those wages, plus the cost of company paid medical insurance, life insurance, workers' compensation insurance, any company matched pension contributions, and other company benefits (Adams, 2014). Indirect labor is the cost of any labor that supports the production process, but which is not directly involved in the active conversion of materials into finished products. Indirect labor cost would include production supervisor, purchasing staff, materials handling staff and materials management staff. The cost of both types of indirect labor can be fully loaded with the costs of benefits and payroll taxes for financial analysis or cost accounting purposes, since these additional costs are closely associated with the indirect labor positions (Adams, 2014). Direct material cost is the cost of important materials that are used in the manufacture of a product or used in providing a service. Direct material costs are definitely identifiable to the contract. The concept of estimating direct materials costs is very straightforward. It consists of determining what is needed, how much is needed, and figuring the cost of the components Types of direct material cost VectorCal would be associated with is timber, steel, and circuit boards. To determine the amount of direct materials cost in a product, create a bill...
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...L. Elise Bowling Case 5A - Glaser Health Products BUS 630 Managerial Accounting Wendy Achilles February 25, 2013 Case 5A – Glaser Health Products Glaser Health Products of Ranier Falls, Georgia needs assistance in evaluating and classifying costs in order to implement an activity-based costing system. As stated in the case, these costs will be used for planning and control decisions rather than inventory valuation. The activity-based costing system will provide better allocation of Glaser’s overhead costs rather than a system to look at the cost drivers or the activities that their overhead costs comprise. Glaser’s general structure of an activity-based costing model should consist of cost objects, activities, consumption of resources, and cost. Activity-based costing changes “the rules of the game” since it changes some of the key measures that manager’s use for their decision making and for evaluating individuals’ performance (Accounting4management.com). In order for Glaser to implement a successful activity-based costing system management must take a look at their overhead costs and justify whether or not they have enough overhead to be worrying about. While we do not know Glaser’s monetary value of their overhead costs, it seems that they have several divisions with a large amount of cost categories management must consider. The three main divisions of Glaser Health Products are Operations, Sales, and Administrative. ...
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...the institute of cost accountants of india(ICAI) (A Statutory body under an act of parliament) SYLLABUS 2012 STRUCTURE & contents Evaluation Synthesis ANALYSIS ANALYSIS APPLICATION APPLICATION COMPREHENSION COMPREHENSION COMPREHENSION KNOWLEDGE KNOWLEDGE KNOWLEDGE LEVEL A LEVEL B LEVEL C FOUNDATION COURSE - Syllabus 2012 the institute of cost accountants of india(ICAI) (A Statutory body under an act of parliament) SYLLABUS 2012 STRUCTURE & contents The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 1 FOUNDATION COURSE - Syllabus 2012 The Following table lists the learning objectives and the verbs that appear in the syllabus learning aims and examination question. Learning objectives Level A COMPREHENSION What you are expected to understand List Make a list of. State Express, fully or clearly , the details/ facts of. Define Give the exact meaning of. Communicate the key features of. Distinguish Highlight the differences between. Explain Make clear or intangible/state the meaning or purpose of. Identify Recognise, establish or select after consideration. Illustrate What you are expected to know Definition Describe KNOWLEDGE Verbs used Use an example to describe or explain something. The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) ...
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...ACCT 640 Case 2 Performance Drinks, LLC ACCT 640 Case 3 Performance Drinks, LLC Click below link for Answer http://workbank247.com/q/acct-640-case-2-performance-drinks-llc-acct-640-ca/12454 http://workbank247.com/q/acct-640-case-2-performance-drinks-llc-acct-640-ca/12454 Performance Drinks, LLC is owned by Dave N. Port. Performance Drinks produces a variety of sports centered drinks. They began operations in 1993 shortly after Mr. Port graduated with his M.B.A. That report is following: PERFORMANCE DRINKS - MONTHLY PROFIT REPORT | | Basic | Hydration | Intensity | Post Workout | Total | REVENUE | | | | | | Sales | $125,000 | $120,000 | $74,250 | $93,000 | $412,250 | COSTS | | | | | | Direct Materials | $40,000 | $50,000 | $31,000 | $33,000 | $154,000 | Direct Labor | $25,000 | $20,000 | $10,000 | $18,000 | $73,000 | Fringe Benefits on Direct Labor | $11,250.00 | $9,000.00 | $4,500.00 | $8,100.00 | $32,850.00 | Manufacturing Overhead | $43,750.00 | $35,000.00 | $17,500.00 | $31,500.00 | $127,750.00 | TOTAL COST | $120,000.00 | $114,000.00 | $63,000.00 | $90,600.00 | $387,600.00 | GROSS MARGIN | $5,000.00 | $6,000.00 | $11,250.00 | $2,400.00 | $24,650.00 | GROSS MARGIN RATIO | 4.00% | 5.00% | 15.15% | 2.58% | 5.98% | | | | | | | Annual Volume: | 100,000 | 80,000 | 45,000 | 60,000 | 285,000 | Unit Price: | $1.25 | $1.50 | $1.65 | $1.55 | $1.45 | Unit Cost: | $1.200 | $1.425 | $1.400 | $1.510 | $1.360 | Since your primary area...
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...Christopher Bonner BUS630: Managerial Accounting (NAH1313A) Instructor; Brian Shaw Middlehurst House Analysis: Case 9A in Chapter 9 Middlehurst House Analysis: Case 9A in Chapter 9 As we are familiar with the case, we feel that two very important issues have not been addressed which in sufficient detail, given that it may influence the profitability of the business venture. These are General: (1) The allocation of capital by both the partners and the stockholders (2) Auditing of facilities and services so that expansion can be carried out later or even facility augmentation Economic viability (3) If such extension is meant to augment the profit of the partner, or to offset the losses (either of the two) than what steps can be taken to ensure this is viable, and the best economic process is thought off? Let us first examine the conditions via which the initial capital allocation is made. In the case of the school, initial capital expenditure was $40,000. This capital is entirely given by Compton, and Freidman has no contribution in the capital. Freidman gives his services as the Director of operations (having experience in similar situations before). Compton’s initial $40,000 is enough for the initial purchases and the operating capital. At the end of the month, Freidman takes a salary as the director of the school, the amount: $2,000. Then after Freidman’s salary has been credited to Freidman’s account and debited from Salary account and all other expenses...
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...------------------------------------------------- Management accounting From Wikipedia, the free encyclopedia | This article contains wording that promotes the subject in a subjective manner without imparting real information.Please remove or replace such wording and instead of making proclamations about a subject's importance, use facts and attribution to demonstrate that importance. (February 2012) | Accounting | | * Historical cost accounting * Constant purchasing power accounting * Management accounting * Tax accounting | Major types of accounting[show] | Auditing[show] | People and organizations[show] | Development[show] | Business portal | * v * t * e | In Management accounting or managerial accounting, managers use the provisions of accounting information in order to better inform themselves before they decide matters within their organizations, which aids their management and performance of control functions. Contents [hide] * 1 Definition * 2 Scope, practice, and application * 3 Differences between financial accountancy and management accounting * 4 Traditional vs. innovative practices * 5 Role within a corporation * 6 Specific methodologies * 6.1 Activity-based costing (ABC) * 6.2 Grenzplankostenrechnung (GPK) * 6.3 Lean accounting (accounting for lean enterprise) * 6.4 Resource consumption accounting (RCA) * 6.5 Throughput accounting * 6.6 Transfer pricing * 7 Resources...
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...PEPPERDINE UNIVERSITY THE GEORGE L. GRAZIADIO SCHOOL OF BUSINESS AND MANAGEMENT PROFESSOR CHUCK MCPEAK MBAM-601.13 ACCOUNTING FOR DECISION MAKERS FALL 2006 WENESDAY 8-12 AM MALIBU SYLLABUS ACCOUNTING FOR DECISION MAKERS MBAM-601.13 FALL 2006 Wednesday 8-12 AM Malibu Chuck McPeak 217 23rd St. Manhattan Beach CA 90266 Office (310) 506-4879 Home (310) 545-6921 FAX (310) 546-7671 Email cmcpeak@pepperdine.edu Course Description The primary emphasis of this study is to place sophisticated tools and techniques in the hands of primary users in making business decisions. Specific topics include cost behavior analysis, cost management systems, relevant cost analysis, performance measurement, and value-based management control systems. The course also includes presentations in teams whereby the students apply the course material. Course objectives At the conclusion of this course the student should be able to communicate cost information orally and in writing and should demonstrate managerial level analysis and decision making in the following areas: 1.Cost-Profit-Volume Analysis 2.Master budgeting 3.Relevant revenues 4.Management control systems 5.Performance measurement 6.Activity based costing 7.Job order costing 8.Ethical issues and the impact of Sarbanes-Oxley 9.The use of production data and information technology to solve business problems Text and Course Materials 1.Horngren, Foster & Datar “Cost Accounting A Managerial Emphasis”, Twelfth Edition, Prentice Hall, 2006 2.Harvard...
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...A STUDY ON VARIOUS ACCOUNTING PRACTICES FOLLOWED AT LAXMIPATI SAREES A Project Report Submitted for the partial fulfillment of the Bachelor of Business Administration 2011-2014/15 SEMESTER IV Page 1 In the subject of MANAGERIAL ACCOUNTING Submitted by Karishma Chandak Nishit Deora Chinmay Jariwala Sameer Iyer Submitted to Mrs. Meghna Dangi AURO UNIVERSITY TABLE OF CONTENTS Acknowledgment .......................................................................................................................................... 3 1 2 3 4 5 6 Introduction:.......................................................................................................................................... 4 Company profile ................................................................................................................................... 6 Production and Operations carried out at Laxmipati Sarees: ................................................................ 8 Answers to the Questions:..................................................................................................................... 9 Recommendations: .............................................................................................................................. 14 Conclusion .......................................................................................................................................... 15 Page 2 ACKNOWLEDGMENT The success of any project depends...
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...Map for Horngren, Foster & Datar: Cost Accounting: A Managerial Emphasis, 10th Edition (Prentice Hall) This map was prepared by an experienced editor at HBS Publishing, not by a teaching professor. Faculty at Harvard Business School were not involved in analyzing the textbook or selecting the cases and articles. Every case map provides only a partial list of relevant items from HBS Publishing. To explore alternatives, or for more information on the cases listed below, visit: www.hbsp.harvard.edu/educators Case Title Institution, HBSP Product Number, Length, Teaching Note Geographical and Industry Setting, Company Size, Time Frame Abstract, Key Subjects PART ONE: COST ACCOUNTING FUNDAMENTALS Chapter 1: The Accountant’s Role in the Organization Chapter 2: An Introduction to Cost Terms and Purposes Carver HBSP United States, Consulting Co. #199006 consulting, 10,000 7p employees, 1994 Daniel Dobbins Distillery, Inc. HBSP #189065 7p TN #189172 Tennessee, liquor distillery, 1988 The managing partner of a relatively new consulting firm is concerned because training costs at the firm's new training center are higher than expected. Analysis of actual costs compared to those expected is required. In addition, he is considering capitalizing some training costs for later amortization. A management control system for the center is also a priority. A distiller increases whiskey production and income declines because of accounting methods in use. Questions are raised regarding...
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... Vol. 1, No. 1, June, 2010 2010-023X 103 Abstract—Nowadays the business world is changing at a faster and faster pace. The reasons given for this is globalization, highs information technology (IT) investments and the rapid pace of technological change. Organizations are responding in different ways and at different rates to the wide range of IT based opportunities and pressures. The purpose of this paper is to focus on the effects of IT related organizational changes on the management accounting function and to contribute to the body of knowledge about to what extent IT affects the ability to solve accounting tasks. The relationship between IT and accounting practices was investigated qualitatively using six case studies and we will measure the impact of IT on accountants’ tasks. The findings suggest a tendency for change and the decentralization of accounting tasks. Index Terms—Accounting, Accounting Information Systems, Financial Documents, Information Technology, Management Information System. I. INTRODUCTION Nowadays the business world is changing at a faster and faster pace. The reasons given for this is globalization, highs IT investments and the rapid pace of technological change in combination with escalating costs of research and development (Frishamar, 2002). The role of information technology (IT) has shifted over the last decades (Teng & Calhoun, 1996) to become an important part of how companies manage and control their resources. Organizations...
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...TRANSFER PRICING Overview The essential feature of decentralization in large firms is the creation of responsibility centers (e.g. cost, profit, or investment centers). The performance of these responsibility centers is evaluated on the basis of various accounting numbers, such as standard and actual cost, divisional profit or return on investment. A central role of the management accounting system therefore is to evaluate (i.e. attach a dollar figure to) the transactions between the different responsibility centers. Under the subject cost allocation we studied alternative methods to charge user departments for the services rendered by service departments (frequently cost centers). Transfer prices are used to evaluate the goods and services exchanged between profit centers (divisions) of a decentralized firm. Hence, the transfer price is the price that one division of a company charges another division of the same company for a product transferred between the two divisions. 1. There are no cash flows between the divisions. The transfer price is used only for accounting purposes. 2. The transfer price becomes an expense for the receiving manager and a revenue for the supplying manager. 3. If intra-company transfers are accounted for at prices in excess of cost, appropriate elimination entries have to be made for external reporting purposes. Examples of items to be eliminated for consolidated financial statements include: 4. Intra-company...
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...CHAPTER 1 DECISION MAKING AND THE ROLE OF ACCOUNTING TEXT REFERENCE: Hoggett, J.R., Edwards, L., & Medlin, J., Accounting in Australia, Fifth Edition, Chapter 1. OBJECTIVES: When you have studied this chapter, you should be able to: 1. understand the nature of decisions and the decision-making process. 2. appreciate the wide range of economic decisions made in the marketplace. 3. explain the nature of accounting and its main functions. 4. identify the potential users of accounting information. 5. use information to make simple economic decisions. 6. understand the role of accounting information in the decision-making process. 7. understand the differences between accounting for management and accounting for external users. 8. understand how the accounting profession is organised in Australia. 9. identify the different areas of the economy in which accountants work. 10. understand the importance of ethics in business and accounting and how to recognise and handle ethical dilemmas as part of the decision-making process. 1 Chapter 1 STUDY TIPS FOR CHAPTER 1 1. This is an important chapter because it lays the foundation for all topics that will follow. 2. Make sure that you understand each new term as it is introduced. 3. Pay particular attention to the significance of accounting information for decisionmaking processes. 4. Identify the types of activities that are carried out...
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...© 1998 American Accounting Association Accounting Horizons Vol. 12 No. 4 December 1998 pp. 363–373 Financial Information and Quality Management—Is There a Role for Accountants? Leif M. Sjoblom Leif M. Sjoblom is a Professor at the International Institute for Management Development. SYNOPSIS: Different opinions exist with respect to the usefulness of financial information for operational decision making. While academics encourage the provision of accounting information on quality, few companies provide it. This article explores the usefulness (or lack thereof) of Cost of Quality (COQ) and quality-related financial information through the use of a survey and informal discussions and interviews with quality managers. Financial information can be used to flag quality problems, to select and prioritize quality improvement projects and to choose corrective action. The results suggest that financial information has a limited role in supporting these operational decisions. The limitations of current COQ systems, and the lack of relevant, reliable and timely financial information, are among the reasons cited for not using COQ. However, there is a perceived need for additional financial reporting in order to attract the attention of top management and to motivate managers. In order to make COQ more relevant to practitioners, future research must not only focus on improving and disseminating best practices, but also on the multi-disciplinary implementation process. Data Availability:...
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