Individual AssignmentSydney Graduate School of ManagementPage 2 of 9School of Business200494...

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Individual AssignmentSydney Graduate School of ManagementPage 2 of 9School of Business200494 Management AccountingIndividual Assignment (20%), Quarter 1, 2018Key factors to keep in mind when writing your submission are:1. The due date for the hard copy of the individual assignment is at the beginning of your seminar in Week 8, week commencing 8 January 2018. The electronic copy is to be lodged on vUWS by 12:00 midnight on Monday, 26 Feuary 20182. You must submit Microsoft Word (electronic) copy of your assignment through vUWS by 12:00 midnight on Monday, 26 Feuary 2018. Please also refer to instructions within the Learning Guide.3. The file name for the electronic copy must follow the following pattern: your student ID number followed by 200494Assignment. For example, if your student ID number is XXXXXXXXXX, the file name should be 17432968_200494Assignment.4. Students are to keep a copy of all assignments submitted for marking.5. Ensure you use accurate spelling and grammar. It is often best to state things simply and clearly rather than using complicated language in the wrong context. Prior to submission make sure you use tools like spelling and grammar checkers in WORD. You may also want to make use of online tools (e.g. the Writer’s Diet http:writersdiet.com/WT.php?home to improve the quality of your written work).6. All sources of information must be appropriately acknowledged. Ensure that all in-text references are accurate and comply with the Harvard referencing style. A guide is available on the vUWS with examples to assist you. Ensure you use only credible sources appropriate to your level of studies. Wikipedia, for example, is not a credible source. A Reference list of all works cited in your submission must be provided.7. THIS IS AN INDIVIDUAL ASSIGNMENT REQUIRING AN EVAUATION OF A CONTEMPORARY MANAGEMENT ACCOUNTING TECNIQUE. IT IS NOT A GROUP ASSIGNMENT. Each student must present their own work. Failure to do so could lead to accusations of academic misconduct. Please refer to the Misconduct Policy. For the full definition of academic misconduct and the consequences of such behaviour, you are advised to read the Student Misconduct Rule at http:www.westernsydney.edu.au/about_uws/leadership/governance/student_misconduct_rule.8. Use the Assignment Cover Sheet and include your Name and Student ID on the cover sheet. Ensure that the declaration is signed and dated on the Assignment Cover Sheet.9. In addition to loss of marks for incoect answers, marks may be deducted for untidy presentation including inappropriate formatting, poor numerical punctuation, not adhering to other requirements of the assignment. Begin each question on a new page. All journals, tables and statements must have appropriate headings and be presented in a proper format. All answers must be supported by relevant calculations.10. Solutions to the questions contained in this assignment may require research beyond the recommended textbook.11. Assessment percentage 20% (out of 100% total for the unit). Assignment will be marked out of 100 and converted to 20%. Marks for each question are shown alongside the question number.Task: Report on Activity Based Costing‘Activity Based Costing (ABC) has been recommended as an alternative to traditional methods due to its ability to provide more accurate costing of products/services. The adoption of ABC has however received mixed reaction in terms of its adoption.’ RequiredAssume that you are a management accounting trainee working in a manufacturing organisation with multiple products and your supervisor is considering the adoption of ABC in your organisation. You have been asked to prepare a report for your supervisor that meets the following requirements. Undertake research of the literature (academic and professional) and provide a report that outlines the experience (positive and negative) of organisations over the past ten years following the adoption of ABC. Provide a recommendation to your supervisor on whether ABC should be adopted in your organisation.Your report should be structured as follows:    Structure    Maximum Word limit    Page limit    Cover Page    50    1     Executive Summary    100    1    Table of Contents        1    Introduction    100    1/2    Body     1500    3-5    Conclusion    150    1/2    Reference list        1(Please read all the information provided in the previous page before starting the report.)The End

Ckreta · Accepted Answer

Report on activity-based costing 
Table of Contents
Executive summary	3
Introduction	4
Activity based costing	5
Traditional costing system	6
Activity based costing vs traditional costing	6
Conclusion	14
References	15
Executive summary
Activity-based costing has the ability to provide more accurate cost in comparison of traditional costing system. However, both the traditional costing system and activity-based costing has certain benefits and limitations. The activity-based costing is an essential aspect of more reliable and accurate information regarding the cost of product or service.  
Maximizing the wealth of shareholders is the overall objective of the organization. Organizations rely on the cost figures for the further strategic planning of business operations. To achieve this objective the organization chooses the costing system which helps reduce the wastage of resources and provide positive returns to the company. This assignment is focused on the benefits and limitations of both activity-based costing and traditional costing. The costing system of the company tries to satisfy the following major goals of the company
· Allocation of period cost to the company’s products 
· Provide the process control information to the managers of the company
· Provide the estimated product cost to the business managers 
Introduction
Costing system or the cost accounting system is a framework which is used by the companies in order to estimate their product or service cost. Estimation of cost of the product is crucial for the business operations. Basically, costing system are of two types, traditional costing system and activity-based costing system. Both of these systems have some benefits and limitations. The manufacturing company uses activity-based costing to obtain detail information of cost of the product. Activity-based costing system help the companies to accumulate cost by the activities which may comprise of both direct manufacturing and indirect manufacturing cost. 
Activity-based costing is a method to assign the cost to the projects, services, products and another task on the basis of activities and resources required by these activities. On the other hand, traditional costing applies an indirect cost to the products of the company on the basis of some predetermined overhead. 
Activity-based costing
This costing system recognizes the relationship among the products, activities and cost. With the help of this relationship, the company distributes their indirect cost to products more accurately in comparison of traditional costing. It helps in segregating variable cost, fixed cost and overhead cost. It is mostly used in manufacturing industry because it enhances the cost data reliability and produces nearly true cost. It is used in product costing, target costing, and profitability analysis of customers, service analysis and product line profitability analysis. ABC is a popular costing system because it helps the organization to develop better corporate strategy. This system of costing is based on activities, which includes several events such as designing products, setting up machines for production and distributing finished goods. In this system, the activities are considered as cost driver transaction or event. Cost driver is used as an allocation base. This model is more efficient in assigning indirect cost to direct cost in comparison of traditional costing. 
With the help of activity-based costing system, the company can identify and eliminate the services and products which are not profitable and can lower the prices of the products which are unnecessarily overpriced. The company can also identify and eliminate those service processes or production processes which are not effective. This costing system enhances the process of costing in several ways. In place of accumulating all the cost of the company in one pool, its divides cost on the basis of activity(Yang, 2008).

Individual Assignment Sydney Graduate School of Management Page 2 of 9 School of Business 200494 Management Accounting Individual Assignment (20%), Quarter 1, 2018 Key factors to keep in mind when...

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