...Tijuana Bronze Machining A Managerial Accounting Analysis of TBM Table of Contents Introduction 3 Current Strategic Issues Facing the Firm 3 Traditional System – Costing 3 Modern View Costing 4 ABC Costing 5 Comparison/Conclusion 6 Recommendations 7 Introduction Tijuana Bronze Machining (TBM) is a company which specializes in the manufacturing of bronze valves, pumps and flow controllers. Management at TBA is having difficulties understanding the natures of the pump and flow controller pricings, the problem, it seemed, was hidden within their method of cost accounting. The firm was currently taking a “traditional” approach to cost accounting, in which overhead costs are assigned to production on the basis of production-run labour costs. But as Les Paul learned at the conference perhaps the traditional approach was corrupt and needed revision, since costs are a product of activity (Activity based costing). Current Strategic Issues Facing the Firm TBM produces three independent products: Valves, pumps and flow controllers. Valves which brought in 24% of the revenues were seemingly doing good based on the traditional cost accounting system; they were bringing in the targeted price and management was happy with the valve deployment and accounting. Pumps, on the other hand, created a sense of doubt for management; they were baffled at the low price being forced by the market on pumps. The pump market seems to be a fairly large market with strong competition;...
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...Source: http://www.allbusiness.com/accounting-reporting/methods-standards-cost-accounting/498244-1.html#ixzz1nMWBS5qI By Juras, Paul E. ABSTRACT Descriptions of activity-based-costing (ABC) systems have become a standard part of managerial accounting texts. While ABC implementation issues are the focus of a number of articles, these issues are often not addressed in a typical textbook. This case is designed to familiarize you with the behavioral and technical variables that can aid or impede successful ABC implementation. Anderson's (1995) factor-stage model provides a template to organize the discussion of ABC success factors. In this case, you will be cast in the role of a business consultant. You are asked to synthesize the case study's key "change management" insights into a report that could be shared with co-workers in an intranet-based knowledge management system. In addition, you may be expected to prepare a formal presentation of the report for your peers. Implementing change in an organization is about ninety percent cultural and ten percent technical. This is because the organization dynamics, politics, and search for a champion that go on are the real issues that make or break the project. One of the reasons we were able to implement ABC successfully was because the right people became champions. Chris Richards, Director of MIS, Global Electronics, Inc. BACKGROUND Global Electronics, Inc. (GEI), headquartered in Sarasota, Florida, designs, manufactures...
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