Cost

c. The reason the cost of OS-367 increased under the ABC system while the cost of GS-157 decreased is due to the total allocated cost for each product was different from the allocated cost under the Traditional costing system. Traditional allocation methods divide cost by departments and distribute the costs between the departments as they relate to volume-based cost drivers (Edmonds, Tsay, & Olds, 2011). However, ABC allocation methods differs by dividing the cost by activity centers and…

Strategic benefits of CPA 1. Cost and revenue management Without the allocation of marketing, sales, and service costs to individual customers, there is no way of knowing whether the investments made in business development are justified. CPA enables account managers to bring marketing expenditures per customer in line with current revenues per customer and with future revenue potential. Revenues are managed through pricing. There are three important issues related to pricing: discounts, the…

Stir Welding Cost Model This suggestion model considers various cost components engaged in the total cost valuation of a friction stir welded joint pipes. Friction stir welding cost suggestion model is structured using the major cost components. The representative components of a friction stir welding pipes cost evaluation are listed below [37-42]: 1. Labor cost (weld preparation time + actual weld time) 2. Power cost 3. Machine cost 4. Tooling cost The sum of all the component costs…

A cost accounting system is a process or a method used by a business to estimate the cost of their products and to determine how a firm utilizes and earns funds. It aids management in making decisions and in the planning and control of an organization. All types of businesses, whether service, manufacturing or trading, healthcare, require cost accounting to track their activities. Therefore, different firms follow different methods for verifying cost accounting. This paper focus on activity…

The cost accounting system is becoming increasingly important to the organization. Cost analysis helps manager in making decision in areas like pricing, profit, planning, setting standard cost capital investment decision, marketing decision, cost management decisions and others The importance of accounting in managerial decision has been recognized in the literature. Cost data and analysis helps manager in making decision and to pass these decisions on various issues concerning their…

White Construction Cost Estimating Process Overview There are several different levels of estimating used in estimating cost for a construction project. Each level serves a different purpose, dependent on the stage of the project, and has varying margin of errors. Estimates made during earlier stages have a larger margin of error compare to the final estimate report. In this text, the process of preparing a detailed cost estimates will be the main topic with an emphasized on White Construction’s…

performed by the logisticians, logistics is broken into a number of fields including procurement logistics, disposal logistics, domestic logistics, distribution logistics among others (Waters, 2003). Effects of maintenance scheduling on logistics and cost management Maintenance Scheduling, also referred to as planned preventive maintenance (PPM) or simply planned maintenance, is any maintenance activity extended towards an object or equipment. It involves scheduled service visits which are…

break-even point is the level of sales that is necessary to cover both variable and total fixed costs, such that net operating income is equal to zero. In Year 1 and Year 2, because of introducing new PDA, there have loss sales on existing PDA. So, Conch uses the average method to calculate the break-even point. After calculation, the profit per unit for Year 1 and Year 2 is $138.58 and $161.58. The fixed cost is $4,700,000. The break-even point for Year 1 and Year 2 is 33,916 units and…

the short run and long run costs are U-shaped within a business. Short run costs refers to the cost a company will experience in a period of time in which costs are variable, e.g. when a company is releasing a new product. However long run costs refer to those over longer period of time, typically, over the entire product lifecycle. In this essay I will address some of these reasons and explain how they differ from one another in a corporate environment. Short run costs are originally high due…

inventory. The marginal cost is the total variable cost of the product, it consists of direct labour hours, direct materials and direct expenses, therefore when the production units increase, the total variable cost will increase proportionately. In other word, the marginal cost can be avoid if there are no any unit to be produced and will…