project about coca-cola company.

e. Standard costing, variance analysis for coca-cola company. This is used in collaboration with other cost accounting systems like job order costing or process order costing. This is an analysis tool used for evaluation. In this costing, estimated costs that are based on the predetermined costs are used even if the actual costs are not available. Then these costs are later on adjusted to reflect the actual cost incurred. Standard costing consists of three parts- 1. Measure of actual performance 2. The standard cost to get a standard or predetermined performance level 3. A measure of the variance between the two, i.e., the variance between standard and actual This is applicable for all components of products, which are direct labor, direct material cost, and overhead cost. The main difference between manufacturing and service organizations while using standard costing is that service organizations do not have direct material costs. After this comes variance analysis wherein the difference is observed and then the reasons for the same are found out. We can classify variance into two- sales variance and cost variance. This variance can be favorable or unfavorable. When the actual exceed standards, it is favorable, and if the actual is less than standards then unfavorable. (Standard Costing and Variance Analysis, Standard Costing System, 2020) f. Overhead cost management of coca-cola company. Managing overhead costs is one of the pressures on organizations. If they keep the overhead cost low, but if demand increase, then they have to employ more resources to improve service and quality, but this increases the cost. Hence a balance is required to be maintained. To manage the overhead cost, the following steps are followed- 1. Selection of the right approach to an overhead review 2. Involve people 3. Identify critical success factors 4. Conduct overhead activity analysis 5. Conduct Value of money analysis 6. Rebalance the resources (Managing Overhead Costs, 2020) g. Managing customer profitability of coca-cola company. This tool of managerial accountability helps to shift focus from product line profitability to the individual customer profitability. In the customer profitability analysis, various activities and expenses incurred while providing service to a customer are looked at. In this, we focus on getting the profit per customer rather than per product. Rather than focusing on sales, the company focuses on more accurate insight like which the customer segment is the most reliable driver of its profitability. (Customer Profitability Analysis - Formula, Guide, Calculate Profitability, 2020) h. Process-costing system of coca-cola company. Under process costing accounting system, the cost is not allocated or accumulated per job, per batch or per lot. Instead, costs of materials, labor, and overhead are allocated per production process or production department. For example, allocating costs to the cleaning department, packaging process, assembly process, etc. this is mostly used by companies who are involved in mass production of goods, or the goods are identical in nature because the products go through the same production process and other processes. i. Job order costing of coca-cola company. In this costing system, the cost is allocated per job. For example, job A, job B, job C, etc. This type of cost accounting is used by companies that have limited products. This can also be used by companies offering unique or dissimilar products like buildings, furniture, customized dresses, etc. in this accounting system cost is calculated in a given order for a given unit or set of units. The job order sheet summarizes the costs of labor, materials, or overhead of each job.