Prompt

In accounting, costs can be classified differently, depending on the needs of management. These costs are usually assigned to products and services to help managers fulfill their planning, controlling, and decision-making responsibilities. Proper cost classifications and costing methods are key foundational concepts in managerial accounting.

Instructions

For this discussion, I invite you to consider a well-known manufacturing company and pretend you are a manager within that company's organizational structure. As a manager, consider what management activities you might perform and what cost classifications and costing methods would be utilized within your department.

Initial Reply

Add a new discussion topic in this forum by February 28 (to do so, select the "Reply" button, below). In your initial post to this discussion, please address the following items:

1. Company name
2. Company product
3. For the product identified, do you feel the company would use job-order costing, process costing or operation costing? Why?
4. Provide an example of the following costs the company might incur (please give specific examples applicable to the company you identified):
   • Raw material
   • Direct labor
   • Manufacturing overhead
   • Nonmanufacturing cost
   • Direct cost
   • Indirect cost
   • Product cost
   • Period cost
   • Variable cost
   • Fixed cost
5. Provide an example that you, as a manager within the company, might perform for the following activities:
   • Planning
   • Controlling
   • Decision-making