Business Ethics And Sustainability
Business Ethics and Sustainability
Introduction
The utilization of advanced information systems and manufacturing technologies in the organizational processes brought challenges to the appropriateness and relevance of the different costing systems (Epstein & Buhovac, 2014). There are different methods of costing systems which are used by the organizations such as activity based costing, marginal costing, process costing, job costing, absorption costing and some others. The assignment compares and contrasts the costing systems used by the organization in which I am employed. The company uses job costing and process costing systems for their accounting operations.
Discussion
Job costing can be defined as a costing system which deals with the cost associated with the total number of units of the product (Drury, 2013). A job costing system is used by those companies which are producing unique products or jobs.
Process Costing
Process costing can be defined as an accounting system which deals with the cost of the lengthy process which is involved with the production of same or standardised product (Drury, 2013). Process costing is utilised by those companies which are producing standardised products in batches by taking a continuous process.
Differences between Job Costing and Process Costing
Product Uniqueness
Product Cost
Dependence
Control
Inventory Accounts
Examples of the Organization
Advantages of Job Costing and Process Costing
Disadvantages of Job Costing & Process Costing
Conclusion
The paper contrasts and compares the two widely used costing systems such as the process costing and the job costing system. The analysis of both systems which includes the differences, advantages and disadvantages between two systems shows that the process costing system is the most effective and appropriate costing system for certain organizations; however, the adoption of the costing system also depends on the business type and the characteristics of the production units.
References
Demski, J. (2013). Managerial uses of accounting information. Springer Science & Business Media.
DRURY, C.M. (2013). Management and cost accounting. Springer.
Epstein, M. J., & Buhovac, A. J. (2014). Making sustainability work: Best practices in managing and measuring corporate social, environmental, and economic impacts (2nd ed). Sheffield, UK: Greenleaf Publishing. ISBN-13: 9781609949938.
Kaplan, R.S. and Atkinson, A.A., 2015. Advanced management accounting. PHI Learning.
Needles, B. and Crosson, S., 2013. Managerial accounting. Cengage Learning.
