Product Cost Systems

Question: Describe about the Product Cost Systems. Answer: Abstract In any given organization, keeping complete records with regard to the value of their inventory is one of the major concerns. This is because keeping too much stock that is unprofitable or using inappropriate product cost measures may result into a company making losses. It is, therefore, necessary for a company to have an effective product cost system that will be able to provide relevant information when needed. Manufacturers have different methods that they use to determine the product costs. The decision used is usually based on various factors including marketing, and distribution among other factors. It is necessary for an organization to have well outlined mechanisms that may be used to determine the prices for its products so that the company does not incur losses. Having an effective mechanism for determining the product cost will also be necessary for the management of an organization during the decision-making process. Effective product cost measures are necessary to managers for long-term or short-term decisions. This report, therefore, will discuss the concept of product cost and some of the necessary product cost measures that are important to the management while making decisions regarding the price of a particular commodity. This will include providing a clear picture of some of the features of used by the various product cost mechanism to determine the price of a commodity. Also a case study using CSL Limited annual report 2014-2015 will be done to describe the common product cost systems and how the company has used these systems to establish the prices for their commodities. The report will also discuss the various purposes of product cost measures in an organization especially the CSL Limited. The report will conclude, by describing the types of product cost systems and commenting on how CSL Limited has adopted the two systems in its price evaluation strategy for its products. This will include comparing the two strategies and recommending on the effective system for the company. Product Cost Systems Product cost is used to define the costs that a company incurs in producing a product. The cost could be described in terms of the cost that a company incurred for the direct labor, and raw materials that were used to produce the product. The costs incurred to market and distribute the products can also be used to determine the product cost. On the other hand, product cost can be described as the cost a company will incur for the direct labor used while providing service to a client. In this case, the product cost will be based on the cost that relates to the service offered such as employees benefits, and taxes among others (Banker, Data, Kekre Mukhopadhyay 1990). Therefore, to determine the product cost for a given unit; a company will consider a batch of various units that were involved in the production process and the total number of product units produced in a given period that is, Product cost = (cost of direct labor + Cost of direct materials + Consumable supplies units + company overheads)/ Total number of units produced Product cost is very necessary to the management of a company as it provides information that is useful for decision-making. Another use of the product cost is in the preparation of external reports. This report will therefore discuss in detail the product cost and the purpose of the product report. Examples based on CSL Limited will be provided to further describe the concepts of product cost and its purposes to the management of the company. The paragraph provided outlines the various concepts of that are used to describe the product cost. From the paragraph, the product cost concept to be used by a given company will depend on the on the purpose that the managers of a company want to achieve. For instance, there are product costs that are necessary for external reporting while there are those that may be useful to the management of a company as they will be used in the decision-making process. This, therefore, implies that consideration needs to be done so as to determine an effective product cost mechanism to use for any particular company. Despite this, it is important to note that all product cost measures are necessary for inventory evaluation. Hence, product cost measures in a given organization will depend on the purpose such that if the need is to do perform external reporting then the product cost measure will be done based on the cost that was incurred while producing or manufacturing the product. On the other hand, if the purpose is to provide information to the managers of a company that will help in making decisions related to the product such as its price then the product cost measure should be able to provide in detail all the information that is related to the product from the initial point of production to the final stage (Beattie,Taylor, Watts 1985). This information may include the cost involved in manufacturing, marketing, and distribution of the product. The information provided should also include any information regarding the services that were offered to the clients. It is, therefore, necessary for a given company to consider the purpose of the product cost before choosing the type of product cost measur e to use. This, therefore, implies that every organization has to have an effective product costing system. Product costing systems are used in an organization for various purposes. For every organization that produces goods or services, it is necessary for them to have a mechanism for measuring the product cost. This information will be made available in the accounting documents for a company. When an organization expands, it becomes complex to calculate the product cost. The product cost for a given business may be calculated monthly, quarterly or yearly depending on the organizational needs of an organization (Kaplan Atkinson 2015).There are the necessary factors and steps to be followed by a company while calculating the product cost for a given period of time. These steps include: (1) Identifying the cost object; a cost object may be defined as a product or service whose price is to be determined. The cost object usually depends on various factors such as the cost required to produce the product, and the cost of raw materials among other factors. To calculate the cost of a given prod uct, the product units are grouped into a unit and their cost is determined. Hence, where one needs to calculate the cost of an individual unit then the batch price will be divided with number of units, (2) Identifying the direct costs; this follows after one has identified the cost object. Direct costs are normally calculated based on the cost object or the product that an organization produces. In general, management accounting defines two systems that are used to determine the cost of a product; direct cost and indirect cost (overhead costs). It is therefore necessary for an organization to consider the two systems while calculating the product cost. Direct costs define the cost that relates to the product in question that is, the cost can be traced easily to the product that is in question. For any particular company, direct costs are attached directly to the products being produced. Material costs define the materials that have been used to produce a certain product and can eas ily be traced to a given batch of product. Generally, direct costs define those costs that can be traced back to a given product produced by an organization, (3) Identifying the overhead costs; this defines the cost of product which is really not attached to the product but instead is used to facilitate the entire operations of the company. This may range from a range of factors include the electricity bill, material costs or costs involved in maintenance. In management accounting, these costs are treated in the following ways; (a) an accountant may chose to ignore them, (b) they can also be treated as a lump-sum, (c) they may be allocated to their cost object, (4) Determining the cost allocation base; the cost allocation base may be defined as the link used to relate the overhead cost and the cost object. The cost allocation base may be taken to be the total number of goods that are produced by a company over a certain period. For example, the total numbers of drugs produced by CSL Limited. The value chosen as an allocation base should be applied uniformly to all the cost objects, and (5) Developing the overhead rates; the overhead rates define the numbers of dollars that are used to represent overhead costs per unit of the cost allocation base. The general formula for calculating the overhead rates is given as a ratio of the cost pool overhead dollars in the numerator and the total quantity of the cost allocation base that is, Overhead rate = Overhead costs in the cost pool/ Total quantity of the allocation base. From CSL Limited annual report 2014-2015 the following is an example on how to determine the product cost; Item Directed Cost Overhead Cost Product Cost Sales revenue 762,200,000 762,200,000 Cost of Sales 467,700,000 467,700,000 Sundry revenue 199,100,00 199,100,00 Dividend Income 1,290,300,000 1,290,300,000 Interest Income 55,400,000 55,400,000 Research and Development 189,300,000 189,300,000 Selling and marketing 64,000,000 64,000,000 General and administration 113,200,000 113,200,000 Finance cost 6,300,000 6,300,000 Income tax expense 4,900,000 4,900,000 Total 2,590,500,000 362,800,000 2,953,300,00 The product cost determined can be used by an organization for two main purposes. This will usually depend on the management of a company: (1) Decision Making; the decision-making product costs are used to calculate the approximate the marginal costs. In this case, for short-term decision making process, labor costs are considered as a fixed cost because the labor costs tend to remain constant over a wide range of output (Shepherd 2015). Additionally, Overhead costs tend to change only when there are some restructuring processes in a company. Therefore, the only costs to consider in this case are the costs that change with the production that is, it includes the costs that increases the total costs that a company incurs after the production of an extra unit of product, and (2) External Reporting; product costs measures are also important to an organization as they help in generating external reports. External reports are used to describe the cost that an organization incurs which doe s not depend on the units produced over time. Such costs could be material cost or other overhead costs the organization encounters. The material cost in an organization is calculated from the bills that the company pays to support its operations. The material cost is also known as the unit variable cost. In general, external reporting may not be necessary to managers while making short-term decisions. Thus, depending on the purpose of the product cost, managers can choose the product measure to use. In general, there are two main types of product cost system used in the evaluation of the inventories in an organization. The two types include: (1) Direct Cost; this refers to the cost that can be clearly related to a given product or service. These are used by managers in an organization to make incremental decisions. Direct costs in an organization may include direct raw materials, manufacturing supplies, and commissions. However, while doing the inventory evaluation both the direct and indirect costs should be considered, (2) Indirect costs; these are costs that cannot be attached or traced directly to a particular product or activity. Therefore, they are only allocated to a product or service. Thus, indirect costs not only include the cost associated with producing the product but also the cost that are involved in maintaining a company. An example of a companys indirect costs includes the costs of maintaining a given machine. Indirect cost can also be varied or they can be fixe d. From the foregoing, it is necessary for a company to consider in detail how to classify the various expenses in a firm as this will determine how taxes are charged on different products. To conclude, product costing system is a very important aspect for any given organization as it will be used to determine the profitability of a company. Product costs are used by managers of various organizations to make long-term and short-term decisions. In addition, the product cost is also used for preparation of external reports. Depending on the purpose that the managers want to accomplish, an organization may decide to choose among the two different types of the product cost system that is, the direct cost system and the indirect cost system. An organization should consider the two systems while classifying its expenses as direct costs or indirect costs as this has an impact on the taxes charged. From the case study of CSL Limited, the company has effectively applied the concept of product cost in its operation. The company has adopted the use of both direct costs and indirect costs. Direct costs has been used to help the companys managers in the decision making process. This includes the direct labor involved in the manufacturing drugs among others. On the other hand, indirect costs have been used in improving the operations of the company. This has been the case where the CSL Limited has expanded its operations with the recent opening of various facilities such as 300,000 square feet expansion in Kankakee and the state of the art manufacturing facility that was launched in Switzerland. This will have to be considered while determining the prices for its products. The product cost systems will be important to the CSL Limited considering its expansion to various regions of the World. The direct cost will be used by the management to decide on various aspects of manufacturing including raw materials required, and direct labor such as doctors and pharmacists among others. The indirect costs incurred will be used in the improvement of the operations of CSL Limited. References Banker, R.D., Datar, S.M., Kekre, S. and Mukhopadhyay, T., 1990. Costs of product and process complexity. Measures for manufacturing excellence, 2, pp.269-290. Beattie, B.R., Taylor, C.R. and Watts, M.J., 1985. The economics of production (No. 338.5 B369). New York: Wiley. Boothroyd, G., 1994. Product design for manufacture and assembly. Computer-Aided Design, 26(7), pp.505-520. Horngren, C.T., Sundem, G.L., Stratton, W.O., Burgstahler, D. and Schatzberg, J., 2002. Introduction to Management Accounting: Chapters 1-17. Prentice Hall. Johnson, H.T. and Kaplan, R.S., 1991. Relevance lost: the rise and fall of management accounting. Harvard Business Press. Kaplan, R.S. and Atkinson, A.A., 2015. Advanced management accounting. PHI Learning. Lere, J.C., 1986. Product pricing based on accounting costs. Accounting Review, pp.318-324. Niazi, A., Dai, J.S., Balabani, S. and Seneviratne, L., 2006. Product cost estimation: Technique classification and methodology review. Journal of manufacturing science and engineering, 128(2), pp.563-575. Shehab, E.M. and Abdalla, H.S., 2001. Manufacturing cost modelling for concurrent product development. Robotics and Computer-Integrated Manufacturing, 17(4), pp.341-353. Shepherd, R.W., 2015. Theory of cost and production functions. Princeton University Press.

Gaining My Independence Essay Example For Students

Gaining My Independence Essay My mother seeing Im responsible, earning her trust, these are two of the biggest things that happened in my life. Although, the endless struggle and intense arguments to get to that point had an even greater impact on my life. When I just started the seventh grade, about two years ago I got into the business of reselling shoes. For those who dont know what this is its when you buy expensive, very limited Nike footwear and resell the product for even more because of the immense demand for the shoe and the small quantity of the item being produced. I got into this hobby very fast, getting engaged in all the latest sneakers coming out and making connections at stores to get these limited sneakers. Soon everyone knew I was a so called Sneaker Head.   I started to make copious amounts of money for a young adult going to school on the daily. I decided to bring the topic of doing this business up with my mom. At the time she was oblivious that I was doing this or anything like it. Most of this was at a time when I really didnt have a set schedule of where I was living with my dad or mom, both constantly fighting over when I would live here or there, threatening court on each other. They both became blind to caring or even noticing what I was doing in my time and just trying to fight for me to be with them. Instantly she said no, saying I couldnt do this anymore stating, Shoes cant really be worth that much money . I clenched my hands to gether with hope trying to show her but she wouldnt listen, because there wasnt nearly enough evidence. For a little while Im pretty sure she thought I was selling some type of drug because of the amount of money being made for the little I was doing. Also the random expensive items that would be in my room made her wonder. She wanted proof that I really was selling shoes, confirmation. This upset me at the time but I understood she was trying to protect me. She didnt want anything bad to happen to me. I started to keep a log of everything I bought and sold also showing the profit involving shoes. I did this for four months and then showed my mother everything including most receipts that I kept too. Over the course of this time, I had spent over six thousand dollars buying sneakers to sell and made a profit of around three and a half thousand dollars. This coming to a total of almost ten thousand dollars. My mom, seeing how much money is really being made was astonished. She looked at me and asked, how much of this money do you have left,   I replied with around half showing her the Gucci sneakers, Xbox One, multiple controllers, five of the hottest games, computer, Beats earphones, and several thousand dollars of cash sitting in my room. She couldnt believe it. The next weekend we went to the bank and set up an account for me. I also got my own debit card, checking and savings accounts. My Mom finally had trust in me. That day I felt so proud, I told myself I wanted to feel like this more often. Gaining my moms trust is one of the things Im most proud. The amount of responsibility and independence I have been giving by my parents since then is what makes me happy. The satisfaction of knowing my parents have their trust in me is what makes me get up on those long days when I need to go to school at seven in the morning. I finally feel independent.

Fcat Essay Sample

Fcat Essay SampleA fcat grade essay sample provides a guideline for which style to choose when preparing for your examination or essay. Essay grade examples are prepared by a team of award-winning researchers and experts. They analyze hundreds of essays and the methods used by their research subjects.When examining essay grade examples, it is important to remember that there are three basic formats and styles that are used. These include first person, third person, and oral. The first person format is the most informal, yet objective style. The objective or perspective style presents an opinion on the subject matter and is usually described as being one's opinion.These essay grade examples give an overview of the three styles. By familiarizing yourself with the different styles and having them understood, you will have a much better chance of getting through the essay. This is essential because it will make it easier to translate the written form into an oral presentation.In order to be successful in your examination or essay, it is necessary to know how to apply FCDI. Students who have yet to fully grasp this concept may need a little more time to get familiar with the steps needed to develop a good essay. There are several online resources that can help them do this, including application of FCDI in essay writing.Reading the FCDI essay grade examples will be the first step in developing an essay that will score well on the test. Students should look for those that are descriptive and concise. You do not want your essay to take too long to read. Your assignment should be made quickly but at the same time, it should be a meaningful essay that educates and entertains.While composing your essay, you will need to study and learn about FCDI. This includes how to create and structure a successful essay and how to effectively deliver your message to your audience. You may also find it helpful to incorporate your research and knowledge into your writing. There are man y resources that will assist you in this regard. A good resource to look into would be your school library online.The basics of FCDI are to write a logical, concise, and structured essay. This means that you have to maintain your topic and deliver it in a way that everyone will be able to understand and appreciate it. It is not necessary for you to write the entire essay in one sitting. You should plan on practicing the essay a few times in order to get used to its form and structure.One of the best parts of these essay grade examples is that they will teach you how to do all of this. You will learn how to structure a great essay and also how to deliver your message using a different style of writing. When you are ready to move forward with your essay writing, this will be the very first step you need to take.

Review Sheet Excercise free essay sample

Ensures that deportation proceeds In an orderly manner from atria to ventricles ; accelerates and coordinates earth activity to effectively pump blood. Electrocardiography 3. Define EGG. Recording of electrical changes occurring during heart actively 4. Draw an EGG wave form representing one heartbeat. Label the P,SIRS, and T waves: P-R interval: the segment, and the Q-T interval. 5. Why does heart rate increase during running? Exercise raises heart rate by acting through the sympathetic nervous system.Sympathetic nerve fibers release morphogenesis on the heart and the pace maker fires more rapidly. 6. Describe what happens in the cardiac cycle in the following the heart is in relaxation (diastole) situations. 1 . 2. Popularization of the arteries 3. Contraction of the aria 4. deportation of the ventricles contraction of the ventricles 6. Revitalization of the ventricles 7. Define the following terms 1 . Tachycardia: Heart rate over 100 beats/minute 2. Radically: Heart rate below 60 beats/Emanuel 3. Fibrillation: Very rapid uncoordinated myocardial activity 8. Which would be more serious, trial or ventricular fibrillation? Ventricular fibrillation. We will write a custom essay sample on Review Sheet Excercise or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The ventricles have major responsibility for ejecting blood from the heart 9. Abnormalities of the heart valves can be detected more accurately by auscultation than by electrocardiography. Why Is this so? Most often serious valve problems can be detected (heard) with a stethoscope.However, since valves are not part of deportation pathway of the heart, their Inefficiency would not be reached on an EGG, Review Sheet Exercise 31: Conduction System of the Heart and Electrocardiography By begetter Node. AS node, VA Node, VA Bundle, left and right bundle branches, Purging fibers At what structure in the transmission sequence is the impulse delayed? VA Node Allows completion of trial contraction before initiation of ventricular systole. 2. Even though cardiac muscle has an inherent ability to beat. He nodal system plays a critical role in heart physiology.What is that role? Ensures that deportation proceeds in an orderly manner from atria to ventricles ; accelerates and coordinates Recording of electrical changes occurring during heart activity 4. Draw an EGG wave form representing one heartbeat. Label the P,SIRS, and T waves: P-R interval; the S-T 1. Tachycardia: Heart rate over 100 beats/minute 2. Brickyard: Heart rate below 60 beats/minute than by electrocardiography. Why is this so? Most often serious valve problems can deportation pathway of the heart, their inefficiency would not be reached on an EGG.

the feminization of poverty essays

the feminization of poverty essays The Origins of the Feminization of Poverty The United Nations Development Fund for Women reports that women are still the poorest of the worlds poor, representing 70% of the 1.3 billion people who live in absolute poverty. They also estimate that nearly 900 million women in the world have incomes of less than $1 a day. In the United States alone, women are about 50 percent more likely to be poor than men. The feminization of poverty in America has steadily increased since the 1950s. Researchers have investigated the reasons for this increase, citing everything from teenage pregnancy to the rise in deadbeat dads. Over the last thirty-five years there have been several trends in our society that have contributed to the feminization of poverty. In 1978, Diana Pearce published a paper citing that poverty in America was becoming more and more feminized. She cited that almost two-thirds of the poor over the age of 16 were women. Pearce also claimed that even though there were more women entering the labor force between 1950 and the mid-1970s, womens economic status had declined. She argued that the blame for this feminization of poverty belonged to the government because of their lack of support for divorced and single women. She argued, for many the price of that independence has been their pauperization and dependence on welfare (McLanahan 1). Further examination of the issue has shown that various changes in the family have contributed to the feminization of poverty. The last thirty years has seen a steady increase in the amount of children born outside of wedlock. In 1960, about six percent of all births were to unmarried couples whereas by 1996 over a third fell into this category (McLanahan 5). This influx of births to single mothers has weighed greatly on women in poverty. The statistics of children born to unmarried black couples is even more dramatic in...

Ethics - Social Responsibility of a Business Essay

Ethics - Social Responsibility of a Business - Essay Example Based on the situation presented, Company Q is neglecting three areas of responsibilities: employee relations and labor, product safety and liability, and community relations. Furthermore, the scenario suggests that employer suspects of the possible fraud due to the reported incident of losing profit. In depth investigation results to the cause of employee’s poor ethics is the below minimum salary given to them. Ingram (2011) asserts that the common trend in grocery stores is paying low wages for employees, but practicing excessive labor. Thus, the company is violating the labor code and its responsibility to the employees. The consumers requested for the reopening of their store, but they provide high margin items which are not health-conscious, but generate high profit. It may be that competition is not stiff, so the Q grocery store is confident to offer low services. Another possibility is the increased demand of customer for local store; hence, switching cost is unnecessary. However, code of ethics states that companies must offer healthy food choices that adhere to the standard of product safety (Maloni & Brown, 2006). This has been one of the CSR issues that grocery stores must address as part of their commitment to society. Lastly, the rejection of donating day-old goods to the food bank is an indication of poor conduct. As part of the community, company Q must offer help through donations to charities, including governmental organizations. It is the primary response of companies to meet the expectation of stakeholders. The management was apprehensive of the implication of their food donation that will give reasons for employees to commit fraud. This reasoning is creating havoc that will produce disloyalty from consumers and employees. According to the study of Maloni and Brown (2006, p. 40), philanthropic acts develop and invigorate employee’s commitment, and gain competitive advantage. Based on the three

Analysis of an artwork Essay Example | Topics and Well Written Essays - 500 words

Analysis of an artwork - Essay Example Alexandria, a Greek cosmopolitan city wherein dance and mime professions were prevalent during the ancient times1. The dancer is wearing a traditional Grecian dress called peplos with a woolen undergarment called chiton, and a cloak called himation2. Due to the pressure applied by her upper and lower limbs, the himation was drawn taut over her head and body causing the fabric to be draped in realistic folds and pleats imparting a feeling of softness and sheerness of fabrics, which also further enhanced the dancer’s figure which seems to be captured in an exotic and provocative pose. However, the face which was concealed in a veil seems to depict modesty with a hint of mystery. The contrasting emotions made the statuette unique and highly artsy. The dancer’s laced slipper also denotes daintiness and further magnified the femininity of the dancer. In addition, the statuette’s dimensions further established its function as a decorative element or a figurine probably commissioned by a rich patron of the arts. Details of the patron or the one who commissioned the bronze statuette was not disclosed though, but the Greek affluent populace at the time were quite known to appreciate beauty and were quite eager to enhance their homes with luxurious items made of bronze and other expensive materials3. In a comparison with a sculpture mentioned in Kleiner’s book, the â€Å"Peplos Kore† is an example of an Archaic style circa 530-525 B.C. and is made entirely of white marble with blue-grey streaks4. Like the Hellenistic bronze statuette, the material used is expensive. The sculpture also depicts a woman wearing the traditional Grecian dress called a peplos worn over a chiton, but without the himation as seen in the Hellenistic bronze statuette. The woman stands in the typical Archaic style of upright and frontal stance with the dress hanging in rigid and simple lines. The symmetrical patterning