Premium Essay

Cost Accounting Case Study

In: Business and Management

Submitted By mananknl
Words 2613
Pages 11
Table of Contents

1. The Raymond Group – An Introduction.............................................................................2 2. Applications ........................................................................................................................5 2.1. FLUCTUATIONS IN RAW MATERIAL PRICES..................................................5 2.2. DECISION REGARDING LOCATION...................................................................7 2.3. Fixing of SALE price using Break Even Point Analysis...........................................9 2.4. MAKE OR BUY DECISION – POWER ................................................................11 2.5. MANUFACTURING DECISION FOR RETAIL GARMENTS/SUITINGS ........13 2.6. Export Price Fixing ..................................................................................................15 3. Acknowledgements...........................................................................................................16 4. Bibliography .....................................................................................................................16

1. The Raymond Group – An Introduction

The Raymond group was incorporated in 1925 and has now grown into a Rs.1400crore plus conglomerate with highly diversified business interests. The group businesses include Textiles, Readymade garments, Engineering files and tools, Prophylactics and Toiletries. The group is a leader in textiles, apparel and files and tools in India. The group is divided into the following companies: Raymond Ltd. – This Company has five divisions comprising of:


Raymond Textile – This is the flagship of the Raymond group. With a capacity of 25 million meters of high-value pure wool, wool-blended & premium polyester viscose suiting along with half a million blankets and shawls, Raymond Textiles is the world’s third largest…...

Similar Documents

Premium Essay

Cost Accounting Case Study

...Number 3 121 Cost Accounting In Auto Manufacturing Companies In Germany And The United States Robert Jinkens, USA RamMohan R. Yallapragada, Fayetteville State University, USA ABSTRACT Corporate accountants are mandated to prepare and distribute financial accounting reports for external U.S.ers at end of each accounting period. However, there are no similar statutory requirements for corporate accountants to provide managers of their companies with the management accounting information necessary for decision making in their bU.S.iness operations. Cost accounting is an important integral part of management accounting. Product costing has always been a much debated issue in management accounting. The area that has generated a host of conflicting views is the allocation of overhead costs to products. Traditional absorption costing is claimed to be resulting in an unfair allocation of overhead costs to products. New approaches such as the Activity Based Costing (ABC) did not receive widespread adoption. It is being realized in management accounting field that an emerging costing method known as Resource Consumption Accounting (RCA) is a better method for product costing. It is a method adopted by the German manufacturing companies. This paper describes the German cost accounting method and also compares the German cost accounting with the cost accounting in the United States, specifically in the automobile manufacturing indU.S.try. Keywords: Cost Accounting in auto......

Words: 3637 - Pages: 15

Premium Essay

Cost Accounting Case Study

...equipments. As compared to the common method of productions where costs can be directly traced to a per unit basis, the current method has a drawback in allocating the extensive manufacturing overhead costs. This conclusively shows that the original costing system has limited range as the constitution of the cost of production are unlikely to be similar and the assumption that the original system uses a single cost pool for allocating the distinct costs incurred by the intricate and specific production procedures is inappropriate. The inadequacy of the original costing system is cause by the establishment of assorted and distinct products by the company. Each individual product requires different production activities to attain their final output and this implies that the cost of these products are interlink to the required activities needed to produce them. Consecutively, the required activities are directed by their specific and distinct cost drivers. It can be seen that the original costing system assumption of directly allocating costs to products on a per unit basis, instead of individually allocating them to their respective cost drivers before allocation to products, is unsuitably designed. The potential consequences to the limitations can have a negative impact in Cambden Cakes’ decision-making process. The inaccuracy which is caused by using a single cost driver will affect the judgments of the......

Words: 1445 - Pages: 6

Premium Essay

Article

...THE APPLICATION OF INNOVATIVE MANAGEMENT ACCOUNTING PRINCIPLES FOR ENHANCING PROFITABILITY AND COMPETITIVENESS: AN EXPLORATORY STUDY OF JAMAICAN MANUFACTURERS Phillip C. James University of Technology, Jamaica College of Business and Management School of Business Administration ABSTRACT This study represents the first in management accounting research in Jamaica which seeks to determine the extent to which innovative management accounting principles (IMAPs) are applied in the manufacturing sector. The aim is to determine if manufacturers in Jamaica are using IMAPs to improve export competitiveness and enhance profitability .The study also seek to determine the factors that prevent manufacturers from adopting these management accounting principles. Five manufacturing organizations were examined using an exploratory case study approach. Results indicate that companies adopting IMAPs have more reliable information for decision making, higher levels of profitability and competitiveness when compared with non- adopting companies. Key Words: Innovative Management Accounting Principles, Profitability, Competitiveness 1. INTRODUCTION The manufacturing environment of the twenty-first century has changed considerably when compared with what existed decades ago. Arising from this development and with the increase in global competition, the need for accurate cost information has become an imperative. Manufacturers worldwide have suddenly realized that the continued...

Words: 7284 - Pages: 30

Premium Essay

Strategic Management Accounting

...Strategic management accounting: how far have we come in 25 years? Kim Langfield-Smith Monash University, Melbourne, Australia Abstract Purpose – The purpose of this paper is to provide a review of the origins of strategic management accounting and to assess the extent of adoption and “success” of strategic management accounting (SMA). Design/methodology/approach – Empirical papers which have directly researched SMA and prior review papers of the adoption and implementation of SMA or SMA techniques are reviewed. As well as assessing the extent of adoption of SMA and the reasons underlying an apparent low adoption rate, the role of accountants in adopting and implementing SMA is considered. Finally, the success or otherwise of SMA is discussed. Findings – SMA or SMA techniques have not been adopted widely, nor is the term SMA widely understood or used. However, aspects of SMA have had an impact, influencing the thinking and language of business, and the way in which we undertake various business processes. These issues cut across the wider domain of management, and are not just the province of management accountants. Research limitations/implications – There is limited value in conducting future surveys of the adoption and implementation of SMA or SMA techniques. Rather, the focus should be on how SMA-inspired techniques and processes diffuse into general practice within organizations. Originality/value – Twenty-five years after the term strategic management accounting was......

Words: 13437 - Pages: 54

Premium Essay

Research in Management Accounting Innovations

...in management accounting innovations An overview of its recent development Nur Haiza Muhammad Zawawi Department of Accounting and Finance, University of Malaysia Terengganu, Kuala Terengganu, Malaysia and School of Accounting, La Trobe University, Melbourne, Australia, and Management accounting innovations 505 Zahirul Hoque School of Accounting, La Trobe University, Melbourne, Australia Abstract Purpose – The purpose of paper is to present a review of the literature on management accounting innovations (MAIs). Specifically, it explores recent developments in research on MAIs and offers suggestions for future research. The review differs from existing reviews by its specific focus on MAIs and the recent time period covered. In this paper, MAIs refer to the adoption of “newer” or modern forms of management accounting systems such as activity-based costing (ABC), activity-based management, time-driven ABC, target costing, and balanced scorecards. Design/methodology/approach – The paper presents a review of findings from journal articles published in 22 notable accounting journals. Findings – The review finds that research on MAIs has intensified during the period 2000-2008, with the main focus on exploring the extent to which a host of organizational and environmental factors influence the implementation and use of MAIs in organizations. In addition, research on MAIs indicates the dominant use of sociological theories and increasing use of empirical/field studies. Research......

Words: 21564 - Pages: 87

Premium Essay

Accounting Information

...of Management Accounting Techniques in Decision-making: An Empirical Study on Manufacturing Organizations in Bangladesh Farjana Yeshmin* and Md. Amran Hossan** Management accounting is concerned with gathering and reporting internal financial information to facilitate decision-making process. As management accounting is not required to conform to national accounting standards, it allows business to customize the management accounting techniques as per demand of company. As a process of this customization, some advanced quantitative as well as number of qualitative techniques accompany with the traditional techniques, have been emerged to cater the information need in decision making. This study attempts to measure the significance of management accounting techniques in decision making of the selected manufacturing organizations in Bangladesh. In doing so, a total of 74 manufacturing organizations have been surveyed with a structured questionnaire by using 5 point Likert Scale measurement from different categories of manufacturing organizations. Findings reveal that cash flow statement analysis, ratio analysis, budgetary control, CVP analysis, variance analysis and fund flow analysis have been frequently high-ranking techniques. Secondly, the authors have recognized five factors to calculate the variability in decision-making with the help of rotated component matrix which shows that 75.125 % of the total variability has found in the usage of management accounting techniques.......

Words: 6527 - Pages: 27

Premium Essay

Awesome

...management accounting function and to contribute to the body of knowledge about to what extent IT affects the ability to solve accounting tasks. The relationship between IT and accounting practices was investigated qualitatively using six case studies and we will measure the impact of IT on accountants’ tasks. The findings suggest a tendency for change and the decentralization of accounting tasks. Index Terms—Accounting, Accounting Information Systems, Financial Documents, Information Technology, Management Information System. I. INTRODUCTION Nowadays the business world is changing at a faster and faster pace. The reasons given for this is globalization, highs IT investments and the rapid pace of technological change in combination with escalating costs of research and development (Frishamar, 2002). The role of information technology (IT) has shifted over the last decades (Teng & Calhoun, 1996) to become an important part of how companies manage and control their resources. Organizations are responding in different ways and at different rates to the wide range of IT based opportunities and pressures (Johnson et al., 1986). Decisions regarding the building of technical IT architecture should be closely linked to decisions made in designing the IT organisation that should be linked to the organisational design of the company itself. As a result, “Information technology plays a critical role in modern business, especially regarding the......

Words: 4119 - Pages: 17

Premium Essay

Information Technology and Accounting

...Trade, Economics and Finance, Vol. 1, No. 1, June, 2010 2010-023X Information Technology roles in Accounting Tasks – A Multiple-case Study Maria do Céu Gaspar Alves Abstract—Nowadays the business world is changing at a faster and faster pace. The reasons given for this is globalization, highs information technology (IT) investments and the rapid pace of technological change. Organizations are responding in different ways and at different rates to the wide range of IT based opportunities and pressures. The purpose of this paper is to focus on the effects of IT related organizational changes on the management accounting function and to contribute to the body of knowledge about to what extent IT affects the ability to solve accounting tasks. The relationship between IT and accounting practices was investigated qualitatively using six case studies and we will measure the impact of IT on accountants’ tasks. The findings suggest a tendency for change and the decentralization of accounting tasks. Index Terms—Accounting, Accounting Information Systems, Financial Documents, Information Technology, Management Information System. I. INTRODUCTION Nowadays the business world is changing at a faster and faster pace. The reasons given for this is globalization, highs IT investments and the rapid pace of technological change in combination with escalating costs of research and development (Frishamar, 2002). The role of information technology (IT) has shifted......

Words: 4110 - Pages: 17

Premium Essay

Abc System

...2010 2010-023X Factors Influencing Activity-Based Costing Success: A Research Framework Zhang Yi Fei and Che Ruhana Isa becoming more and more popular [3-7] ABC aims to provide accurate costing information to managers to allocate activity costs to products and services by applying cost drivers [8]. Academics who advocate ABC, such as, Cooper and Kaplan [9], and Swenson [10] argue that it provides more accurate cost data needed to make appropriate strategic decisions about product mix, sourcing, pricing, process improvement, and evaluation of business process performance. These claims have led many firms to adopt ABC systems [8]. The benefits of ABC and its positive impact on firm’s performance motivated a numerous studies which examined various aspects of ABC. Among such studies are McGowan [11] who assessed the integrity of ABC success, Innes and Mitchell [4, 12] and Yanren [13] who conducted research on factors affecting ABC adoption, and Shield [3], Shields and McEwen [14], Gosselin [15] and Baired et al.[16, 17]who concentrated on factors influencing ABC success especially at the implementation stage. However, there is mounting evidence that suggests most of firms are experiencing problems in implementing ABC and, in some extreme cases, ABC implementation is not successful [3], which later resulted in abandoning the ABC systems altogether [15]. Questions arise as to why ABC implementation is successful in certain companies and fails in others. Based on the......

Words: 6138 - Pages: 25

Premium Essay

Acct

...ACCT 504 ACCT 504 Entire Course + Final Exam ACCT 504 Week 3 Case Study 1 Flower Landscaping Corporation ACCT 504 Week 5 Case Study 2 Internal Control LJB Company ACCT 504 Week 5 Course Project Draft Spreadsheet ACCT 504 Week 6 Case Study 3 Cash Budgeting LBJ Company ACCT 504 Week 7 Course Project JCP Kohls ACCT 504 Final Exam (3 different sets) + Discussions Financial Reporting Environment and GAAP Details of Financial Statements and Ratios Accounting EquationAccounting Cycle Accrual Accounting and Adjusting Entries Merchandising Operations and Income Statements Inventory Cost-Flow Assumptions Understanding Internal Control and Reporting Cash Accounting for and Reporting Receivables Plant Assets and Intangibles Accounting for Liabilities Accounting for and Reporting Equity Statement of Cash Flows Issues in Income Reporting Different Tools for Financial Analysis ACCT 504 Final Exam (3 different finals) ACCT 504 Week 1-7 Discussion Question ACCT 504 Week 3 Case Study 1 Flower Landscaping Corporation ACCT 504 Week 5 Case Study 2 Internal Control LJB Company ACCT 504 Week 5 Course Project Draft Spreadsheet ACCT 504 Week 6 Case Study 3 Cash Budgeting LBJ Company ACCT 504 Week 7 Course Project JCP Kohls ACCT 505 Week 7 Capital Budgeting Course Project (DEVRY) ACCT 505 Entire Course (DEVRY) ACCT 505 Week 1-7 All Discussion Questions Cost Terms, Classifications, and Behavior Research and......

Words: 631 - Pages: 3

Premium Essay

Pfllc

...Introduction. This course provides an introduction to cost management and management control. It is concerned with the generation, use and interpretation of management and cost information and related data by managers under various organizational systems. This information is used for planning and control, decision-making, performance evaluation, and reporting purposes. The course also examines the impact of quantitative information on motivation and organizational communication. This class presupposes some basic knowledge of financial reporting, economics and organizational behavior. Management accounting is a dynamic field and reflects many of the changes seen in business today. We will often use product-based companies to initially discuss a topic, and then expand our discussions to the service and not-for-profit sectors. Financial accounting is externally oriented and governed by fundamental concepts of generally accepted accounting principles (GAAP). In contrast, managerial accounting is internally oriented. Managerial accounting is very context driven. Management accounting is more intuitively understandable than financial accounting. However, the material cannot be learned by ‘thinking’. You must work through the mini-cases, cases and problems, which are assigned for each class. The concepts and techniques must be used to see how they are developed and applied. Discussion in each class assumes you understand the material covered in prior sessions. ......

Words: 815 - Pages: 4

Premium Essay

Corporate Finance Potter

...ACCOUNTING IN CONTEXT POTTER I LIBBY I LIBBY I SHORT ACCOUNTING IN CONTEXT BRADLEY N. POTTER University of Melbourne ROBERT LIBBY Cornell University PATRICIA A. LIBBY Ithaca college DANIEL G. SHORT Texas Christian University Boston Burr Ridge, IL Dubuque, IA Madison, WI New York San Francisco St. Louis Bangkok Bogotá Caracas Kuala Lumpur Lisbon London Madrid Mexico City Milan Montreal New Delhi Santiago Seoul Singapore Sydney Taipei Toronto Copyright © 2009 McGraw Hill Australia Pty Limited Additional owners of copyright are acknowledged in page credits. Every effort has been made to trace and acknowledge copyrighted material. The authors and publishers tender their apologies should any infringement have occurred. Reproduction and communication for educational purposes The Australian Copyright Act 1968 (the Act) allows a maximum of one chapter or 10% of the pages of this work, whichever is the greater, to be reproduced and/or communicated by any educational institution for its educational purposes provided that the institution (or the body that administers it) has sent a Statutory Educational notice to Copyright Agency Limited (CAL) and been granted a licence. For details of statutory educational and other copyright licences contact: Copyright Agency Limited, Level 15, 233 Castlereagh Street, Sydney NSW 2000. Telephone: (02) 9394 7600. Website: www.copyright.com.au Reproduction and communication for other purposes Apart from any fair dealing for the...

Words: 7672 - Pages: 31

Premium Essay

Factors Influencing Activitybased Costing Success: a Research Framework

...2010 2010-023X Factors Influencing Activity-Based Costing Success: A Research Framework Zhang Yi Fei and Che Ruhana Isa becoming more and more popular [3-7] ABC aims to provide accurate costing information to managers to allocate activity costs to products and services by applying cost drivers [8]. Academics who advocate ABC, such as, Cooper and Kaplan [9], and Swenson [10] argue that it provides more accurate cost data needed to make appropriate strategic decisions about product mix, sourcing, pricing, process improvement, and evaluation of business process performance. These claims have led many firms to adopt ABC systems [8]. The benefits of ABC and its positive impact on firm’s performance motivated a numerous studies which examined various aspects of ABC. Among such studies are McGowan [11] who assessed the integrity of ABC success, Innes and Mitchell [4, 12] and Yanren [13] who conducted research on factors affecting ABC adoption, and Shield [3], Shields and McEwen [14], Gosselin [15] and Baired et al.[16, 17]who concentrated on factors influencing ABC success especially at the implementation stage. However, there is mounting evidence that suggests most of firms are experiencing problems in implementing ABC and, in some extreme cases, ABC implementation is not successful [3], which later resulted in abandoning the ABC systems altogether [15]. Questions arise as to why ABC implementation is successful in certain companies and fails in others. Based on the......

Words: 6138 - Pages: 25

Premium Essay

Title

...Department of Accounting A Graduation Research Proposal Presented to the Faculty of Commerce The Islamic University of Gaza Prepared By Mosa zuhair al-nassan Mosbah al-shaghnobi Mohammed Nabaheen 120091941 120092552 120102597 Supervisor's name Mr. Salah Shubir 3102 I ‫‪I‬‬ ‫‪A Holy Qur'an Verse‬‬ ‫‪A Holy Qur'an Verse‬‬ ‫} وَقُل اعْمَلُوا فَسَيَرَى اللَّهُ عَمَلَكُمْ وَرَسُولهُ وَالْمُؤْمِنُونَ{‬ ‫سورة التوبة– اآلية 105‬ ‫صدق اهلل العظيم‬ ‫‪I‬‬ Dedication Dedication We dedicate this work to our lovely Palestine, to second home of Islamic university, and to our parents, who sacrificed everything in their life for us, and also we thank them for pushing us to success. For all of Those, Who are inspiring us and see us on our way. II II Acknowledgement Acknowledgement In the beginning, we thank Allah for giving us the strength and health to let this work see the light and our parents for their help and support. Our Prophet Mohammed said: “Who doesn’t thank people he doesn’t thank Allah”. We want to thank everyone help and participated in making this study starting from our honorable: Mr. Salah Shubair. Who put a lot of faith in our capabilities and encouraged us to complete this study. We thank all of our teachers in the faculty of commerce and our colleagues and friends for their support . III Abstract Abstract The study aims to discuss and evaluate one of the accounting problems,......

Words: 11924 - Pages: 48

Premium Essay

Cima

...Qualification structure and syllabus CIMA Chartered Management Accounting Qualification 2010 December 2008 Contents CIMA now designs its qualifications in what we believe to be a unique way. Based on rigorous international primary research with all of our key stakeholders and involving the participation of over 6,000 individuals and organisations – members, students, employers (both existing and potential), CIMA tuition partners, universities and our examiner and marker team – we have designed a professional finance training and development solution that is second to none. I commend this revised CIMA Professional Qualification to you. It will be examined for the first time in 2010, so there is plenty of time to absorb the exciting changes contained in the pages that follow. A qualification focused on the future – fit for purpose, relevant and unique I am honoured to introduce the new 2010 Chartered Management Accounting Qualification to all of our stakeholders. With seismic shifts occurring in the world’s economy, coupled with accelerating concerns about the sustainability of our planet, never before has there been a greater need for organisations to train and develop their people to manage the impact of these changes. With this revised qualification CIMA remains true to its long and proud history of providing finance professionals with a difference – Chartered Management Accountants – who combine management and finance skills in a unique way and who fully......

Words: 22006 - Pages: 89