Cost Accounting: The Four Elements Of Inventory Valuation

BP161 Enterprise level spend analysis Spend analysis involved collection of data across procures to pay process in an enterprise and slicing and dicing these data into useful information. It is used for supplier negotiation future saving forecasting working capital and cash management activities. The various software available in the industry include: SAAS, ARIBA, SAP-SRM, Oracle-Supply chain. Enterprise Level Spend Analysis aims at enhancing visibility of the spends in an organization and provides high value input for operational and strategic decisions. Aberdeen group, 2012 says that spend data management has emerged as one of the leading strategies enterprises will use to drive continuous improvements in supply management.

“CM = Selling Price - Variable Costs”. It can be considered as either unit contribution margin or total contribution margin. Contribution margin is the profit available to cover fixed costs & produce net income to the owners. The contribution margin can also be viewed as a percentage or ratio. To compute the contribution margin ratio, divide CM by the Selling Price.

Analysis c. How does Wilkerson’s existing cost system operate? Develop a diagram to show how costs flow from factory expense accounts to products. Costing systems help companies determine the cost of a product related to the revenue it generates. Two common costing systems used in business are traditional costing and activity-based costing. Wilkerson is currently using the traditional costing system.

Hence, be a source of competitive advantage is the key resources which is not only located within the organization but it is also a part of relationship of network. Besides, the responsibility of the manager in supply chain management is to maintaining high rise elasticity and to achieve efficiency cost of supply chain. One of the key factors in term of to ensure the efficiency of financial management is the effectiveness of cost control. The commonly brought up of supply chain management’s goals is a cost reduction. Besides, with reducing cost, it is forcing companies to point on increased attention on the relationship with another party in supply chain.

Thematic Analysis 1- Significance of the Research Study ERP plays a major role in Vendor Managed Inventory. A vendor managed inventory is a process where the manufacturer generates order for the manufacturer based on the demand created by the distributor using ERP. During this process the manufacturer follows mutually agreed objectives between the manufacturer and distributor for filling rates and transaction costs. In this regard, some ordering model in Vendor Managed Inventory for the retail industry will be discussed, and its effect on supply chain collaboration mechanism is reviewed, and finally the process cost reduction as a supplier, will be discussed as operational model and rate of this quantities improvement is measured. 2- Implementation

People use it to measure how much the company actually earn out of sales. It is used for comparing similar companies. The company with higher profit margin means it has a better cost-control. This ratio reminds company of suitable budgeting on cost and sale(Kong, 2007). Promotion According to Kettler (1988), promotion can be viewed as an essential motivational factor for making purchase, changing the sense of customers on price or product by adding extra benefits.

Under this type of analysis, a number of ratios used for measuring the meaningful quantitative relationship between the items of financial statements during the particular period. This type of analysis is useful in comparing the performance, efficiency, and profitability of several companies in the same group or divisions in the same company. In order to avoid the limitations of Comparative Statement, this type of analysis is designed. Under this method, financial statements are analyzed to measure the relationship of various figures with some common base. Accordingly, while preparing the Common Size income statement, total sales is taken as a common base and other items are expressed as a percentage of sales.

Increased competition 3.1.4 Supplier Management Suppliers are major contributors in the effective functioning of supply chain operations. They can contribute through the timely and quality deliveries of goods and services. Therefore, it is essential that a purchase manger should work with suppliers to coordinate their operations and customer needs. i. Aspects of Supplier Management There are various aspects of supplier management such as vendor analysis, supplier audits, supplier certification and supplier partnering.

1. Importance of logistic and supply chain management. Logistics is the goods from the supplier to receive the entity flow process, according to the actual need, transportation, storage, procurement, handling, packaging, circulation processing, distribution, information processing, and other functions for the purpose of conforming customer requirements. Why are they so important? Logistics can reduce the enterprise cost, enhance the competitiveness of enterprises.

In order to manage their companies’ inventory, business owners create procedures . The type of small business, size of operations and number of business locations often dictate the model of inventory management system a company uses. Inventory replenishment features include an authorized purchase order sent to a vendor or supplier requesting additional inventory products. Business owners generally implement a specific inventory order process for replenishing inventory. These products was receives and verifies by the company employee.