Assigning costs and assets , Managerial Accounting

Assigning Costs and Assets

After identifying its value chain, a firm must assign operating activity and assets to value activities. Operating costs must be assigned to the activities in which they are incurred. Assets must be assigned to the activities which employ, control, or most influence their use. The assignment of operating costs is uncomplicated in principle, though it can be time-consuming. Accounting records must often be recast to match costs with value activities rather than with accounting classifications, particularly in areas such as overhead and purchased inputs. As assets are costly and their selection and use frequently involve tradeoffs with operating costs, assets should be allocated to value activities in some way that will allow an analysis of cost behavior. Assignment of assets to activities is more complicated than assignment of operating costs.

Posted Date: 12/8/2012 5:51:20 AM | Location : United States







Related Discussions:- Assigning costs and assets , Assignment Help, Ask Question on Assigning costs and assets , Get Answer, Expert's Help, Assigning costs and assets Discussions

Write discussion on Assigning costs and assets
Your posts are moderated
Related Questions
The management of Popular Stores Sdn. Bhd. are in the process of exploring the company’s investment opportunities.

VALUE CHAIN ANALYSIS Every firm is a collection of activities that are executed to design, generate, market, deliver and support its products or services. Value chain analysis

Organizing (1) It is the establishment of the framework within which the required activities are to be performed and the designation of who should perform such activities. It inc

Integer Programming It is a technique for solving a linear programming model with an added constraint that the decision variables must only be non-negative integers. In the

5 application areas of linear programing in management accounting

Competition oriented pricing policy Most companies fix the price of their products after a careful consideration of the competitor's price structure. Deliberate policy may be f

Responsibility Accounting This is a term used to define the measuring of performance of decentralized units, using account results. Responsibility accounting recognizes various

solution to problem 2-23,T-Accounts;applied overhead of Kleinman Company is a manufacturing firm and employess a job-order costing system.

Identify whether each of the following transactions involves spot exchange, contract, or vertical integration. For the last item if the contract length is optimal or suboptimal.

Full Service Recourse Factoring : In this kind of factoring the client has to bear the risk of default made through the debtors. There the factor had advanced funds against book de