tailieunhanh - Management accounting: Information for creating and managing value (4/e): Chapter 8 - Kim Langfield-Smith, Helen Thorne

Chapter 8 "Activity-based costing", This chapter presents the following content: Problems with conventional product costing systems, an activity-based costing model, initial decisions about ABC at Mason & Cox, using the ABC model for product costing at Mason & Cox, activity-based versus conventional product costs,. | Chapter 8 Activity-based costing 8- Problems with conventional product costing systems General features of conventional product costing systems Direct material and direct labour costs are traced to products Manufacturing overhead costs are allocated to products using a predetermined overhead rate Manufacturing overhead rate is calculated using some measure of production volume Non-manufacturing costs are not assigned to products continued 8- 8- Problems with conventional product costing systems Failure to adapt to the changing business environment Increasing levels of non-volume-driven manufacturing overhead costs Increasing proportion of non-manufacturing costs Causes of changes in costs Changing product structures and increased product diversity 8- 8- Indicators of problems with a product costing system Product costing systems are likely to result in inaccurate product costs when Proportion of direct labour costs decreases Proportion of manufacturing overhead costs increases Proportion of manufacturing overhead costs, not related directly to production volume, increases Non-manufacturing costs that are product-related become substantial Product diversity increases 8- 8- Problems with costing in service businesses Service firms tend to use firm-wide, volume-based overhead rates Overhead costs are increasing in importance, and are increasingly non-volume driven Customers are demanding more diverse and higher quality services Increases in product diversity and quality increase the level of non-volume-driven overhead costs Cast doubt on the accuracy of service costs derived from a conventional product costing system 8- Activity-based costing A methodology that can be used to measure both the cost of cost objects and the performance of activities Can help solve problems such as Distorted product costs Poor cost control The form of ABC method adopted depends on the problems that need to be addressed 8- 8- An activity-based . | Chapter 8 Activity-based costing 8- Problems with conventional product costing systems General features of conventional product costing systems Direct material and direct labour costs are traced to products Manufacturing overhead costs are allocated to products using a predetermined overhead rate Manufacturing overhead rate is calculated using some measure of production volume Non-manufacturing costs are not assigned to products continued 8- 8- Problems with conventional product costing systems Failure to adapt to the changing business environment Increasing levels of non-volume-driven manufacturing overhead costs Increasing proportion of non-manufacturing costs Causes of changes in costs Changing product structures and increased product diversity 8- 8- Indicators of problems with a product costing system Product costing systems are likely to result in inaccurate product costs when Proportion of direct labour costs decreases Proportion of manufacturing overhead

• Ngân hàng - Tín dụng
• Management accounting
• Lecture Management accounting
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• Activity based costing
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