Cost Accounting Essays (Examples)

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Cost Accounting
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Themido, I., A. Arantes, C. Fernandes & A.P. Guedes. (2000). Logistic costs case study: An
ABC approach. The Journal of the Operational esearch Society, 51 (10): 1148-1157

Stable UL: http://www.jstor.org/stable/253927

The use of Activity-Based Costing (ABC) reflects the fact that indirect costs and overhead costs are often more draining to modern organizations than direct costs.

The article specifically discusses the use of ABC in terms of its use in costing logistics services.

Traditional costing in logistics uses the direct product profit-ability (DPP) methodology which is "to identify all the costs associated with a product or an order as it moves through the distribution channel" (Themido et al. 2000: 1149).

ABC identifies activities "that are responsible for costs and therefore consume resources, provides a cost flow assignment chain which enables the activity costs to be continuously re-assigned or imputed to the products, customers, or services that use the activity" (Themido et al. 2000: 1149).

The article concludes….

An incorrect entry or inherent errors in the accounting procedures (for instance mistakes in contract cost allotment) can endanger the system. Organizations need to make sure that their employees are well versed with the latest cost accounting policies and have a backup plan for unfortunate mishaps. The presence of recruits who are unaware of the cost accounting process often destabilize the investments made on the accounting software (Tinsley, 2010).
Time is a crucial factor when it comes to cost accounting. The organization needs to function efficiently enough to face any government audits, even if conducted on short or no prior notice. Contractors need to be prepared and tackle any situation positively enough to receive affirmative evaluation results. Dealing with a company which associates itself with a recalcitrant accounting system wastes time. ecuperating from problems and reclaiming government approval is usually harder. It can result in premature expiration of contracts, dissipation….

Accounting Responsibility
Responsibility of managers in managing projects and creating budgets

Managerial ethics is essential in managing projects and creating budgets. Ethical accounting ensures all financial information is reported to business owners, directors or managers. Managers who fail to report negative information or use a company's internal financial information for personal gain can create serious legal situations for businesses (Vitez, N.d.). Business owners and managers often require all information, whether good or bad, when reviewing business operations and making decisions. It is also important to create accurate budgets. There is often a temptation to tweak budgets to fulfill personal goals. For example, if you favored a particular project you may try to make it more appealing financially. However, it is necessary to be as objective as possible to ensure that you create budgets ethically.

Accountable for achieving financial performance targets

Managers are often under immense pressure to meet financial performance targets. In some cases….

competing cost accounting approaches and explores best practices implemented in different countries. The essay examines traditional cost accounting (CA), activity-based costing (ABC), Grenzplankostenrechnung (GPK), throughput accounting (TA) and resource consumption accounting (CA).
Tradeoffs Between Cost Accounting Systems

Comparing traditional costs systems and ABC shows that there are tradeoffs between cost and usability. The traditional cost system is typically both easy and inexpensive to implement; however, the information obtained from the system may be too raw to be analytically useful. ABC provides useful information, but by comparison is expensive and time-consuming to implement (Abdallah & Li, 2008).

The use of a given accounting system involves tradeoffs which may make it better suited for some companies than others. Companies using a Six Sigma/theory of constraints (TOC) may benefit more from the throughput accounting (TA) approach. TA emphasizes variable costs, with the objective of increasing throughput while simultaneously decreasing inventories and operating expenses. TA thereby….


The consultant allocates fixed costs based on the ratio of departmental square footage to total dealer square footage, adjusted by a weighting factor. The weighting factor takes into account various machinery, equipment, furniture, and fixtures located throughout the dealership. The consultant used a factor of 1, which is an industry standard.

The consultant acknowledges that the departments have very different functions, costs and profits, however his attempt to allocate costs does not adequately take into consideration their differences. I believe that these results are questionable due to the lack of specificity in the financial statements. Given that the revised profitability number will be used to determine if jobs will be eliminated and is also used to determine the body shop manager's bonus, I recommend that if it is available that, Mr. Delaney provides more detailed information on the labor-hours or creates a better measurement system for both fixed and semi-variable costs….

Premier Products
he contribution margin is the revenue less the variable costs. We know the price for each product, and we know the variable material costs. Labor costs are also know ($5/hr). hus, the remaining issue is the allocation of overhead, which the company does on the basis of direct labor hours.

Contribution Margin

Product

Price

Materials

Labor

Overhead

Contribution

Cont. Margin

here are two production constraints. One machine can only be used for A or B, the other machine for only C and D. o maximize contribution margin, the company should produce the product with the highest contribution margin, which in this case is product B and product D. hey have the highest contribution, and contribution margin.

o determine the impact on profits, the current profitability should be compared with the profitability that would arise from the proposed change. A pro forma income statement will illustrate, but of course the actual sales are not provided. We don't know how profitable….

Accounting Course Concepts
Olympus Corporation

Company Overview

With sales of $10.6 billion for the fiscal year ended March 31, 2011, Olympus Corporation (hereinafter alternatively "Olympus" or "the company"), is a leading manufacturer of endoscopic medical devices, cameras as well as other sophisticated imaging devices, microscopes, and information and communications equipment (Verschoor, 2012). According to the company's business profile, Olympus Corporation competes in medical, life science, industrial and the imaging sectors (Business profile, 2014). Currently, Olympus Corporation competes in five primary business segments as follows:

The Medical segment offers medical endoscopes, surgical endoscopes, ultrasound endoscopes and others.

The Life and Industry segment provides biological microscopes, industrial microscopes, industrial endoscopes and non-destructive testing equipment.

The Video segment provides digital cameras and sound recording machines.

4. The Others segment is engaged in the provision of biomaterials, and the development of systems.

5. The Common segment mainly involves in holding investment and financial investment (Business profile, 2014).

As of March 31, 2013,….

This memo addresses the concern regarding the production cost report and why you were only credited with only 2,000 units equivalent units in ending inventory. The key question relayed to me is why the credited amount was not considerably higher compared to what you took into consideration earlier. The main reason why this is the case is linked to process costing and the equivalent units of production. There is usually a confusion between the units partially completed and the units totally completed. Basically, equivalent units of production are utilized by a manufacturer for the expression of partially completed units of product with respect to finished units. They key aim of utilizing equivalent units is to have the ability of apportioning the costs of production to completed units as well as partially completed units held in work process. In essence, the notion of equivalent units takes into account articulating a number….

Managerial Accounting for Sleepease Ltd.
"Identify, discuss and critically evaluate the advantages and problems of using the following costing methods for internal reporting purposes":

absorption costing; marginal costing.

"Refer to the Sleepease case as and when necessary"

absorption costing

The absorption costing is the type of managerial costing where both the variable and fixed costs are charged to process or product. Thus, "absorption costing is a method for appraising or valuing a firm's total inventory by including all manufacturing costs as product costs, regardless of whether they are variable or fixed and therefore it is frequently referred as the full cost method." (Nawaz, 2013 p 50).

Accordingly, the company will be able to determine costs of a product after determining both the variable costs and fixed costs. Sleepease will derive several benefits from using the absorption costing for the production of their product.

First, the absorption costing will assist the company to take the account of all….

Yet, financial statements and managerial accounting reports can be highly effective nonetheless. Sometimes they will merely confirm what the proprietor already knows, but there are inevitably going to be times when they will reveal that the proprietor's assumptions about the nature of the business are false. Moreover, accounting can act as essentially a second opinion. The proprietor may feel one thing is true, but the numbers can reveal something different.
Overall, accounting is an essential component of any business. Sole proprietorships often make less use of accounting, in part because the law does not obligate them to engage in any more than the most rudimentary accounting. However, proprietors should not overlook the value of accounting. Accounting helps to reveal the business' past performance, but can also be used to enact organizational controls today and to help plant for more effective operations in the future. By understanding the firm's cost structure….

Wood was used more for recording, ink and seals were used to write accounts on top of a piece of wood. It was used mostly by everyone as it was inexpensive plus it was very easy to write on top of it. Marked stick also played many roles, also known as counting tally. ut in fourteenth century, there was an argument for a decline in tallies and to increase the use of paper which was found in England. Still this was an expensive import, in a result tally remained there for many years along for efficient calculation's an abacus was used.
y 1700, few professional accountants were found in Scotland for the Italian method of book keeping. ut by 1800 there were many professional accountants who were operating in the major Scottish towns as the knowledge of accounting became even more common in the business community. The notable accountants were….

An unaware analyst may think the second company to be better but in reality its low encouraging level is due to the fact that it is unable to secure additional funding. The companies may possess different capital structures and to attempt comparison of performance when one is all equity financed and another is a geared company may not suffice for a good analysis. The chosen application of government incentives to several companies may also twist the inter-company evaluation. There may be the possibility of providing a company with the tax holiday while the other within the same line of business not, and evaluation of such two enterprises may be misleading. (Session 15: Limitation of atio Analysis)
As a matter of principle, the accounting strategies are required to be applied persistently. Changes are required to be emphasized and the influence of variations from an original policy revealed. This is applicable when….

Accounting
Differential Cost

Differential Cost strategy when used by an educational entity such as UOS means that the institution determines what it would cost to offer alternative forms of education based on the number of students interested in choosing those alternative forms. In other words, by offering choices to the students based on the student's specific needs and desires and then measuring the difference in cost when compared to other educational offerings, the school will know exactly what the differential cost is. This allows the school to offer courses and activities in the most efficient and effective manner, and in a manner that produces the highest amount of revenue with the lowest cost. By knowing the difference between the school's offerings and what the same type of offerings are being offered by their competitors, the school will be capable of offering more for less. As an example, if the school decided to….

Dibsa should turn towards the market-based pricing strategy, which sees the implementation of competitive prices for the 3-in-1 Lawnmower. The selection of this combination of strategies would generate several impacts upon the company, but most of them would be obvious at product lifecycle level. In this order of ideas:
The sales revenues would be significantly high throughout the first six months and they would allow the company to cover for the large costs incurred in the manufacturing of the product as well as register profits; they would however decrease with the implementation of the market pricing strategy and the 3-in-1 Lawnmower would metamorphose from a star product into a cash cow

The costs incurred in the manufacturing of the new lawnmower have already begun to decrease and will continue to do so; the actual impact of the pricing strategy is limited, with the specification however that these costs will not be….

Another example of pure job costing is web development, where the processes themselves vary hugely from project to project, meaning the cost and time involved also varies.
esponse

Dosch & Wilson (2010) do seem to do a good job of defining job and process costing, and the person who posted this seems to have understood these definitions fairly well in the abstract -- that is, the definitions provided seem reasonable and the application of these definitions to businesses chosen by the poster are explained in a way that clearly links them to these definition. At the same, the poster seems to have had some trouble accurately identifying companies where job costing might be employed, despite grasping the abstract technicalities of the definition of job costing. While it is likely that an individual laborer might be able to identify that they worked on a particular section of an airplane or wall of….

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2 Pages
Term Paper

Accounting

Cost Accounting

Words: 415
Length: 2 Pages
Type: Term Paper

Themido, I., A. Arantes, C. Fernandes & A.P. Guedes. (2000). Logistic costs case study: An ABC approach. The Journal of the Operational esearch Society, 51 (10): 1148-1157 Stable UL: http://www.jstor.org/stable/253927 The…

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4 Pages
Research Paper

Accounting

Accounting for Contractors Cost Accounting

Words: 1077
Length: 4 Pages
Type: Research Paper

An incorrect entry or inherent errors in the accounting procedures (for instance mistakes in contract cost allotment) can endanger the system. Organizations need to make sure that their…

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2 Pages
Research Paper

Accounting

Decision-Making in Cost Accounting With a Focus on Ethics

Words: 520
Length: 2 Pages
Type: Research Paper

Accounting Responsibility Responsibility of managers in managing projects and creating budgets Managerial ethics is essential in managing projects and creating budgets. Ethical accounting ensures all financial information is reported to business…

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4 Pages
Essay

Business - Management

Competing Cost Accounting Approaches and Explores Best

Words: 1361
Length: 4 Pages
Type: Essay

competing cost accounting approaches and explores best practices implemented in different countries. The essay examines traditional cost accounting (CA), activity-based costing (ABC), Grenzplankostenrechnung (GPK), throughput accounting (TA) and…

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2 Pages
Case Study

Transportation

Auto Dealer Cost Accounting Comment

Words: 682
Length: 2 Pages
Type: Case Study

The consultant allocates fixed costs based on the ratio of departmental square footage to total dealer square footage, adjusted by a weighting factor. The weighting factor takes into account…

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2 Pages

Accounting

Cost Accounting Case for Premier Products

Words: 566
Length: 2 Pages
Type:

Premier Products he contribution margin is the revenue less the variable costs. We know the price for each product, and we know the variable material costs. Labor costs are also…

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4 Pages
Research Paper

Business

Advance Cost Accounting Course Concepts to Real World

Words: 1148
Length: 4 Pages
Type: Research Paper

Accounting Course Concepts Olympus Corporation Company Overview With sales of $10.6 billion for the fiscal year ended March 31, 2011, Olympus Corporation (hereinafter alternatively "Olympus" or "the company"), is a leading…

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3 Pages
Essay

Accounting / Finance

Different Costing Approaches in Accounting

Words: 865
Length: 3 Pages
Type: Essay

This memo addresses the concern regarding the production cost report and why you were only credited with only 2,000 units equivalent units in ending inventory. The key question relayed…

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8 Pages
Essay

Accounting - Corporate Finance

Cost Accounting for SleepEase Ltd

Words: 2005
Length: 8 Pages
Type: Essay

Managerial Accounting for Sleepease Ltd. "Identify, discuss and critically evaluate the advantages and problems of using the following costing methods for internal reporting purposes": absorption costing; marginal costing. "Refer to the Sleepease…

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5 Pages
Essay

Accounting

Accounting Is the Basic Function

Words: 1515
Length: 5 Pages
Type: Essay

Yet, financial statements and managerial accounting reports can be highly effective nonetheless. Sometimes they will merely confirm what the proprietor already knows, but there are inevitably going to…

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4 Pages
Term Paper

Accounting

Accounting History Accounting Texts Were

Words: 1149
Length: 4 Pages
Type: Term Paper

Wood was used more for recording, ink and seals were used to write accounts on top of a piece of wood. It was used mostly by everyone as…

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5 Pages
Term Paper

Business

Accounting Ratios the Financial Statements

Words: 2089
Length: 5 Pages
Type: Term Paper

An unaware analyst may think the second company to be better but in reality its low encouraging level is due to the fact that it is unable to…

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4 Pages
Essay

Teaching

Accounting Differential Cost Differential Cost Strategy When

Words: 1151
Length: 4 Pages
Type: Essay

Accounting Differential Cost Differential Cost strategy when used by an educational entity such as UOS means that the institution determines what it would cost to offer alternative forms of education based…

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10 Pages
Research Proposal

Business

Costing the Analysis Is Based

Words: 2854
Length: 10 Pages
Type: Research Proposal

Dibsa should turn towards the market-based pricing strategy, which sees the implementation of competitive prices for the 3-in-1 Lawnmower. The selection of this combination of strategies would generate…

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2 Pages
Term Paper

Transportation

Costing Process V Job Costing

Words: 649
Length: 2 Pages
Type: Term Paper

Another example of pure job costing is web development, where the processes themselves vary hugely from project to project, meaning the cost and time involved also varies. esponse Dosch &…

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