Companies rely on two basic cost accounting systems that are consistent with the nature and quality of the product. The process costing, and the job order costing system, and these two systems are very important in cost accounting. I will present them in some detail as follows: Job order costing. The job order costing system is followed in the intermittent and diversified production projects in which production is carried out according to certain specifications. This system is also followed in the case of small enterprises that produce a product for a specific period of time and then move to produce another product for a specific period and then move to another product, and so this transfer requires knowledge of the cost of each order of a
The operations manager needs some ways to assign the jobs which will be sent to centre, and look for an arrangement that will help to minimize the processing and setup costs, minimize the unwanted time in work centre, or minimize the job completion time. Under this situation, Gantt chart that used for loading and scheduling can help them. Gantt chart is derived from Henry Gantt, who pioneered the use of charts for industrial scheduling in early 1900s. It can be used in two different ways. It is used to organize and display the actual or intended use of resources in a time framework Gantt chart can be separated into several types.
West Yost has a set determined pay schedule which is well defined according to pay period, pay date, and work day. This information matches the payroll and timecard systems. While new hire, term, and pay changes generate from HR with appropriate approvals, the accounting department is responsible for processing payroll. Based upon a review of the employees sampled, employees were paid in accordance with time and attendance. Voluntary and mandated deductions were also processed according to documentation on file, and defined payroll processes.
The direction, in which a company will progress, depends on how a company has planned its policies to achieve its objectives in the future. The planning usually includes investment planning, expansion planning and forecasting of sales. Organising: Management accounting helps a management accountant organise the team and all resources such as funds, people to ensure that the planning is implemented properly for achieving goals and the objectives of the organisation. Controlling: Controlling is one of the most important goals of management accounting. It is carried out by comparing the actual performance with that of standard performance, which is usually set in the budget.
Engineer the product. The engineers and procurement personnel on the team now take the leading role in creating the product. The procurement staff is particularly important if the product has a high proportion of purchased parts; they must determine component pricing based on the necessary quality, delivery, and quantity levels expected for the product. They may also be involved in outsourcing parts, if this results in lower costs. The engineers must design the product to meet the cost target, which will likely include a number of design iterations to see which combination of revised features and design considerations results in the lowest cost.
For example changes in sales, productivity, changes in industry demand and output. If this is communication is established it will allow for collective procedures to be customary. Determining the factor that restricts performance: It is well known that in every organization there is some influence that restricts the prudent running in the business.it is said that demand is the main concern. Therefore it is important that this hiccup is identified while preparing the budget. Preparation of the sales budget: The level of sales and sales mix govern the level of a company’s operation, when sales demand is the aspect that hampers output.
126.96.36.199. Expenditure Cycle The expenditure cycle is a recurring set of business and related information processing operations associated with the purchase of and payment for goods and services. The expenditure cycle was focused on the acquisition of raw materials, finished goods, supplies, and services. 1. Ordering materials, supplies and services This activity was focused in ordering inventory, supplies, or services that involves identifying what, when, and how much to purchase, and then choosing from which supplier to purchase 2.
• Indirect expenses: Factory rent, factory lighting, repairs and maintenance, depreciation of factory building and machines. Administration Overhead Administrative or office overheads are the expenses incurred on formulation of policy, directing the organisation, as well as and control and management of affairs. Office overheads are necessary for effective operation of business. They are the aggregate of indirect materials, indirect labour and indirect expenses. Examples of administrative overhead include: • Indirect materials: Printing and stationary, cleaning materials and water containers.
There are many types of costing method and among them process costing method and job order costing method are mainly applied in accounting system. Process costing , also called process manufacturing is the mass production of homogenous goods and services in continuous flow of step. In process costing, product and service pass through a series of sequential process. An important characteristics of process costing is the high level of standard in product and produce the same nature of goods and services or homogenous product. Likewise, Job order costing also called job order manufacturing is the production of unique nature of goods and services or heterogenous product.
Payroll administration Payroll administration encompasses all the tasks involved in paying an organization’s employees. It typically involves keeping track of hours worked and ensuring that employees receive the appropriate salary. It also includes calculating taxes. The specific tasks involved in payroll administration tend to vary according to the needs of each company. For example, some companies have workers that receive commissions in addition to salaries.