Sun Shine Orange Grove: Integrated Cost Management System
Integrated Cost Management 1
Running head: INTEGRATED COST MANAGEMENT
P1_DB1_Cost Accounting Systems
Integrated Cost Management System Applied to Sun Shine Orange Grove
April 10, 2011 Discuss how the development of a costing system and budget applies to Sun Shine Orange Grove (SSOG).
Include in your answer: * definition of an integrated cost management system * scope of an integrated cost management system * goals of an integrated cost management system * three items that affect the design of an integrated cost management system for SSOG
Integrated Cost Management 2 Costing, a very important process Sun Shine Orange Grove will engage in to track where money is being spent to produce and distribute there juice products. Understanding these costs is the art of controlling them. Choosing the appropriate type of costing system for there particular industry is also an art that in the end will assure the lowest overhead cost for the highest revenues while increasing product value for the consumer (Bradford, T., 2008, April 28). Costing done through cost management systems, by defining these systems, understanding the scope of the system, and recognizing the goals of the system the company can determine items affecting the design of these systems (Horngren, C., Datar, S., Foster, G., Rajan, M., & Ittner, C., 2009). There are three more common costing systems job order costing, process costing, and activity based costing (ABC). Job order, used by companies to produce and fill specific orders by estimating the cost allocated to production on different jobs. Process costing used to determine the cost of labor, production, and supported activities of goods passing through different stages to final production of product. ABC costing, where other costing systems concentrate assigning costs to products, designed to assign cost to activities. ABC is a more complex system assigning indirect costs to suitable
Running head: INTEGRATED COST MANAGEMENT
P1_DB1_Cost Accounting Systems
Integrated Cost Management System Applied to Sun Shine Orange Grove
April 10, 2011 Discuss how the development of a costing system and budget applies to Sun Shine Orange Grove (SSOG).
Include in your answer: * definition of an integrated cost management system * scope of an integrated cost management system * goals of an integrated cost management system * three items that affect the design of an integrated cost management system for SSOG
Integrated Cost Management 2 Costing, a very important process Sun Shine Orange Grove will engage in to track where money is being spent to produce and distribute there juice products. Understanding these costs is the art of controlling them. Choosing the appropriate type of costing system for there particular industry is also an art that in the end will assure the lowest overhead cost for the highest revenues while increasing product value for the consumer (Bradford, T., 2008, April 28). Costing done through cost management systems, by defining these systems, understanding the scope of the system, and recognizing the goals of the system the company can determine items affecting the design of these systems (Horngren, C., Datar, S., Foster, G., Rajan, M., & Ittner, C., 2009). There are three more common costing systems job order costing, process costing, and activity based costing (ABC). Job order, used by companies to produce and fill specific orders by estimating the cost allocated to production on different jobs. Process costing used to determine the cost of labor, production, and supported activities of goods passing through different stages to final production of product. ABC costing, where other costing systems concentrate assigning costs to products, designed to assign cost to activities. ABC is a more complex system assigning indirect costs to suitable
References: Bradford, T. (2008, April 28). Types of Accounting Costing Systems. Retrieved April 10, 2011, from Suite101.com: Online Magazine and Writers ' Network: GlobalShiksha, (2010). Cost Management. Retrieved April 10, 2011, from Education In India by leading Educational Portal: http://www.globalshiksha.com/Cost-Management/ugc/2709394683111966 Horngren, C., Datar, S., Foster, G., Rajan, M., & Ittner, C. (2009). Cost Accounting