Kế toán, kiểm toán - Chapter 8: Activity - Based costing

A methodology that can be used to measure both the cost of cost objects and the performance of activities Can help solve problems such as Distorted product costs Poor cost control The ABC method adopted, depends on the problems that need to be addressed

ppt30 trang | Chia sẻ: thuychi20 | Ngày: 04/04/2020 | Lượt xem: 58 | Lượt tải: 0download
Bạn đang xem trước 20 trang tài liệu Kế toán, kiểm toán - Chapter 8: Activity - Based costing, để xem tài liệu hoàn chỉnh bạn click vào nút DOWNLOAD ở trên
Chapter 8Activity-based costing1Problems with conventional product costing systemsGeneral features of conventional systemsDirect material and direct labour costs are traced to productsManufacturing overhead costs are allocated to products using a predetermined overhead rateManufacturing overhead rate is calculated using some measure of production volume Non-manufacturing costs are not assigned to productscontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithProblems with conventional product costing systemsFailure to adapt to the changing business environmentIncreasing levels of non-volume-driven manufacturing overhead costsIncreasing proportion of non-manufacturing costsCauses of changes in costsChanging product structures Copyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithIndicators of problems with a product costing systemProduct costing systems are likely to result in inaccurate product cost whenProportion of direct labour costs decreaseProportion of manufacturing overhead costs increaseProportion of manufacturing overhead costs, not related directly to production volume, increasesNon-manufacturing costs which are product-related become substantial; and Product diversity increasesCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithProblems with costing in service businessesService firms tend to use firm-wide volume-based overhead ratesOverhead costs are increasing in importance and are increasingly non-volume drivenCustomers are demanding more diverse and higher quality servicesIncreases in product diversity and in overhead costs Copyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithActivity-based costingA methodology that can be used to measure both the cost of cost objects and the performance of activitiesCan help solve problems such as Distorted product costsPoor cost controlThe ABC method adopted, depends on the problems that need to be addressedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithAn activity-based costing modelThe costing viewMeasures the cost of activitiesAssign activity costs or productsActivity management viewThe nature of cost driversResource driversActivity driversRoot cause cost driversCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithThe costing view of ABCMeasuring the cost of activitiesAssign costs to activity centresIdentify and cost the activities performed in each activity centreAssigning activity costs to productsCalculate the activity cost per unit of activity driverPrepare a bill of activities for each productCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithActivity-based costing terminologyActivity: a unit of work performed with the organisationCost driver: a factor or activity that causes cost to be incurredResource driver: cost driver used to estimate the cost of resources consumed by an activityActivity driver: a cost driver used to estimate the cost of an activity consumed by the cost objectcontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithActivity-based costing terminologyRoot-cause cost driver: the underlying factors that cause activities to be performed and their costs to be incurred Bill of activities: identifies the activities, the activity cost per unit of activity driver, the quantity of activity drivers consumed, and, therefore, the cost of the activities consumed by the productCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithDifferent forms of ABCSimple approach: allocates manufacturing overhead to productsABC system for indirect costs: allocates manufacturing overhead and non-manufacturing costs to productsComprehensive system: all product-related costs, except direct material, are included in the ABC systemcontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithDifferent forms of ABCWhich costs should be included in an ABC system?The decision to include activity based management an in ABC systems will influence the range of costs included in the system as well as the type or cost driversCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithActivity-based hierarchy of costs and activitiesUnit level activitiesPerformed for each batch of productBatch level activities Performed for each batch of productsProduct level (or product-sustaining) activitiesPerformed for specific products or product familiesFacility level (or facility-sustaining) activitiesNot usually included in product costsCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithActivity-based vs. conventional product costsConventional costing assumes product costs are driven by volume-based cost driversConventional costing ignores batch size. Units produced in large batches consume a relatively low consumption per unit of batch costsABC may include non-manufacturing costsCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithThe benefits of ABC are greatest whenOverhead costs are a significant proportion of total cost, and a large part of overhead is not directly related to production volumeThe business has a diverse product range, and individual product’s use of support resources differs from their use of volume-based cost driverscontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithThe benefits of ABC are greatest when...Production activity involves diverse batch sizes and product complexityProportion of product-related costs incurred outside manufacturing is increasing relative to manufacturing costscontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithThe benefits of ABC are greatest whenThere are likely to be high costs associated with making inappropriate decisions, based on inaccurate product costsThe cost of designing, implementing and maintaining the ABC system is relatively low due to sophisticated IT supportCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithImpediments to introducing ABCLack of awareness of ABCUncertainty about the potential benefits from ABCFirms understand the need for change but are concerned about the extensive resource requirements to implement ABCResistance to change among managers and employeesCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithOther activity-based costing issuesVariations in types of ABC include whetherActual (past) or budgeted costs are analysedImplementation is a one-off project or an on-going systemCost objects, other than products, are includedBudgeted costs may be used in an ABC systemABC may be implemented as a one-off project or a systemcontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithOther activity-based costing issuesImplications of excess capacityABC estimates the cost of resources used to perform activities to produce and sell products, which may not always equal the cost of resources suppliedNeed to account for the costs of unused capacity when budgeted costs have been used to generate activity-based product costscontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithOther activity-based costing issuesBehavioural issues Change can be perceived as threateningABC may require changes in data collected and collection and analysis proceduresBottom-up change management may give some degree of ownership of any changes caused by ABCManagement must be seen as committed to the change processCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithLimitations of activity-based costingFacility level costsIf a high level of facility-level costs are allocated to products, an arbitrary element enters into the product costUse of average costsUnitised batch, product and facility-level costs can lead to product costs that are of limited use for decision makingcontinuedCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithLimitations of activity-based costingComplexityThe cost of updating an ABC system can be very high, but is needed to avoid producing outdated, irrelevant informationThe level of complexity increases when the systems is used for activity managementCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-SmithActivity-based costing in service organisationsABC can be difficult to implement in service firms, becauseHigh levels of facility costs so fewer cost can be includedIndividual activities are difficult to identify because they are non-repetitiveA non-repetitive production environment makes it difficult to identify service outputsCopyright  2003 McGraw-Hill Australia Pty Ltd, PPTs t/a Management Accounting: An Australian Perspective 3/e by Langfield-Smith, Thorne & HiltonSlides prepared by Kim Langfield-Smith

Các file đính kèm theo tài liệu này:

  • pptppt_ch08_1064.ppt