Question

PLEASE RESPOND TO THE QUESTIONS SIMPLY AS IT IS ASKED IN YOUR OWN WORDS. I just need simple and accurate answers. Do not add extra stuff. Just the questions asked.

Describe the flow of costs for a job order costing system and explain how the debits and credits move costs from manufacturing costs all the way to cost of goods sold (COGS). Discuss the trends in managerial accounting and in particular explain the following four (4) managerial tools; i) value chain, ii) Just In Time Inventory, iii) Six Sigma & TQM, iv) The Balanced Scorecard. Give examples of companies who are using these four managerial accounting tools and what benefits have they gained from implementing any of these tools.

Answer 1

A.

1. the basic recording will be the recording of the cost as work in progress. the direct labour and direct material is recorded in WIP

2. then we add-in indirect labour and any manufacturing overhead to manufacturing overhead control account which is added to WIP at a predetermined rate.

3. the cost of finished units is credited to WIP account and debited to Finished goods account.

4. when the units are sold the cost is credited to Finished good account and debited to COGS.

B.

managerial accounting recent trends.

there are 7 trends quite famous in the market as of now.

1. expansion from product to channel and customer profitability analysis.

2. management accounting roles expanding with enterprise performance management.

3. shift to predictive accounting.

4.business analytics imbedded in EPM methods.

5.Co-existing and improved management accounting methods.

6.managing information technology and shared services as a business.

7. the need for better skills and competency with behavioral cost management.

1) value chain: this is a basic analysis of all the steps that are taken in an organization in order to deliver the products to the end-user this includes all the process input transformation delivery as well as customer feedback. it is also a decision support tool that gives a competitive advantage to the organization.

2) just in time inventory; it a procurement method under which the stock is ordered as and when it is needed this removes the need for storing huge amount of inventory and it provides a considerable saving in terms of storage place and wages for the movement of such goods within the organization.

3) six sigma: it is an ongoing process as to under which the organization gets into continuous improvement of the product by removing the defects in the process and the procedure of the production of the product. the aim of this tool is to remove 99.99% of defects. it studies all the processes that are undertaken for delivery of the product and defects are removed.

4) TQM: total quality management is the process of detecting and reducing or eliminating errors in manufacturing, streamlining supply chain management, improving the customer experience and ensuring the employees are up to mark in providing the services.