Post Reply 
 
Thread Rating:
  • 0 Votes - 0 Average
  • 1
  • 2
  • 3
  • 4
  • 5
Management accounting question
01-06-2011, 02:21 PM
Post: #1
Management accounting question
It is now fairly widely accepted that conventional cost accounting distorts managements view of business through unrepresentative overhead allocation and inappropriate product costing. This is because the traditional approach usually absorbs overhead costs across products and orders solely on the basis of the direct labour involved in their manufacture. And as direct labour as a proportion of total manufacturing cost continues to fall, this leads to more and more distortion and misrepresentation of the impact of particular products on total overhead costs.

You are required to discuss the above and to suggest what approaches are being adopted by management accountants to overcome such criticism.


Can anyone help me to answer this question, it is quite important for me.. thanks for your help )
Visit this user's website Find all posts by this user
Quote this message in a reply
01-06-2011, 06:03 PM
Post: #2
 
Activity Based Costing (ABC).......is more accurate method specially to allocate overhead costs to product, But disadvantage is that it will involve more time and effort.

Regards.
Visit this user's website Find all posts by this user
Quote this message in a reply
01-06-2011, 08:09 PM
Post: #3
 
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by yasir_live</i>
<br />
Activity Based Costing (ABC).......is more accurate method specially to allocate overhead costs to product, But disadvantage is that it will involve more time and effort.

Regards.

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
isit the question is talking about ABC problem? and can you give more information regarding this matter?

Sorry, forgive me i am new in accounting... a lot of accounting things i dunno..
Visit this user's website Find all posts by this user
Quote this message in a reply
Post Reply 


Forum Jump:


User(s) browsing this thread: 1 Guest(s)