You are a management accountant at ABC Manufacturing Company, a company that produces a variety of products using both job order costing and process costing systems. Your task is to analyze the costing methods used by the company and provide recommendations for improving cost control and profitability. Follow the instructions below to complete the project:

PART 1: JOB ORDER COSTING ANALYSIS (40 pts)

a) Choose one product that is manufactured using job order costing at ABC Manufacturing Company. Provide a brief description of the product and its production process.

b) Identify and describe the different cost elements involved in the production of the chosen product. Include direct materials, direct labor, and manufacturing overhead costs.

c) Select a specific job for the chosen product and calculate the total cost for that job using the appropriate cost elements identified in part b. Use the following information:

• Direct materials cost: $5,000
• Direct labor cost: $3,000
• Manufacturing overhead rate: 150% of direct labor cost

d) Discuss the advantages and limitations of job order costing for ABC Manufacturing Company. How does it help in providing accurate cost information for each specific job?

PART 2: PROCESS COSTING ANALYSIS (40 pts)

a) Choose one product that is manufactured using process costing at ABC Manufacturing Company. Provide a brief description of the product and its production process.

b) Identify and describe the different cost elements involved in the production of the chosen product. Include direct materials, direct labor, and manufacturing overhead costs.

c) Calculate the cost per equivalent unit for each cost element identified in part b. Use the following information for a specific production period:

• Total direct materials cost: $20,000
• Total direct labor cost: $10,000
• Total manufacturing overhead cost: $12,000
• Total units produced: 1,000
• Units in ending work in process: 200

d) Calculate the total cost of production for the chosen product during the production period using the cost per equivalent unit calculated in part c.

e) Discuss the advantages and limitations of process costing for ABC Manufacturing Company. How does it help in providing cost information for mass-produced products?

PART 3: RECOMMENDATIONS (20 pts)

Based on your analysis of both job order costing and process costing at ABC Manufacturing Company, provide recommendations for improving cost control and profitability. Consider the following aspects:

• Cost allocation methods for overhead costs in job order costing.
• Methods for tracking and controlling costs in process costing.
• Accuracy and timeliness of cost information in both costing systems.
• Cost reduction strategies or process improvements to enhance profitability.

Support your recommendations with clear explanations and examples.

Submission Guidelines:

• Prepare a comprehensive report that includes the analysis and recommendations for both job order costing and process costing.
• Clearly present calculations, formulas, and explanations.
• Use tables, charts, or diagrams to illustrate your findings.
• Ensure your report is well-organized, cohesive, and properly formatted.
• Provide a conclusion summarizing your key findings and recommendations