Author Archive for: admin

JOB, BATCH AND PROCESS COSTING LEARNING OBJECTIVE JOB COSTING BATCH COSTING PROCESS COSTING  NORMAL LOSS EQUIVALENT UNITS 1.JOB COSTING A job is an individual product designed and produced as a single order for an individual customer. Well-known examples include small building and building repair work, car maintenance and repair work, printing, painting and decorating. All of the actual costs incurred

MARGINAL COSTING AND ABSORPTION COSTING LEARNING OBJECTIVE PRODUCTION AND NON PRODUCTION OVERHEADS THE CONCEPT OF CONTRIBUTION ABSORPTION COSTING AND MARGINAL COSTING 1.PRODUCTION AND NON PRODUCTION OVERHEADS Under and over absorption of production overhead: It is very unlikely that the forecasts for production overhead and activity levels used to determine the absorption rate will be 100% accurate. There will almost certainly

EXPENSES AND ABSORPTION OF OVERHEADS LEARNING OBJECTIVE EXPENSES TYPES OF INDIRECT EXPENSE OR OVERHEAD CAPITAL AND REVENUE EXPENDITURE COST CENTRES ALLOCATION, APPORTIONMENT,REAPPORTIONMENT AND ABSORPTION FOR OVERHEAD 1.EXPENSES In cost accounting terms there are three types of business expenditure: materials, labor and expenses. Expenses are all business costs that are not classified as materials or labour costs. It is possible to

LABOUR COSTS LEARNING OBJECTIVE LABOUR COST CALCULATING GROSS PAY– Time Related pay CALCULATING GROSS PAY-OUTPUT RELATED PAY SALARIED EMPLOYEES-BONUSES TIME RATE EMPLOYEES – BONUSES GROUP BONUS SCHEMES GROUP BONUS SCHEMES PAYROLL NON-MANUFACTURING ORGANISATIONS 1.LABOUR COST Holiday : Employees have an agreed number of days holiday per year. Sickness : The organization will have its own policies regarding payment  for

MATERIALS COST LEARNING OBJECTIVE MATERIALS COST CLASSIFICATION STORE, PROCEDURE AND DOCUMENTATION FOR MATERIALS PRICING ISSUES OF MATERIALS BOOKKEEPING ENTRIES 1. MATERIALS COST CLASSIFICATION Types of Inventory: raw materials, work in progress (WIP), finished goods. Direct materials are the materials that can be directly attributed to a unit of production, or a specific job, or a service provided directly to a

Classification of Costs and Cost Behavior LEARNING OBJECTIVE I. Classification of Costs II. Cost Behaviour Patterns III. Direct Costs and Indirect Costs I. Classification of Costs  Classification is a means of analyzing costs into logical groups so that they can be summarizes into meaningful information for management use or for preparing external financial report. The criteria used for the classifications will depend

INTRODUCTION TO MANAGEMENT INFORMATION LEARNING OBJECTIVE PURPOSE OF MANAGEMENT INFORMATION DATA AND INFORMATION THE FEATURES OF EFFECTIVE MANAGEMENT INFORMATION THE SOURCE AND CATEGORIES OF INFORMATION MANAGEMENT ACCOUNTING AND FINANCIAL ACCOUNTING RESPONSIBILITY CENTRES 1.PURPOSE OF MANAGEMENT INFORMATION Management information is used by managers to: Plan the future of the business. For example, future cash flows and whether borrowing will need to