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2
MANAGERIAL ACCOUNTING

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 Abstract
The result of the maintenance of the cost records of the organizations is discussed in
this research report. The explanation of job costing is performed and able to maintain
all the cost departments and maintain a separate set of records. There are few
costing practices which are performed in many types of manufacturing sectors. The
job costing is chosen from the four costing procedures and acquired necessary cost
information from all the financial record systems. The cost system design is
discussed in this research report elaborately.

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 Table of Contents
Introduction...................................................................................................................4
Part A............................................................................................................................4
Part B............................................................................................................................7
Conclusion..................................................................................................................10
Reference list..............................................................................................................11
Appendices.................................................................................................................13

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Introduction
The research paper is based on job costing, a distinctive method to execute all types
of work in an orderly form. It adopts all types of specifications gained from the
production process and depends on the number of orders that are settled with the
received orders from the customers. It is standardized as per the requirements of the
customers. The main purpose of job costing is to settle with manufactured goods that
are not settled but immediately delivered at once in all aspects. The section of costs
are separated for each job order which differs from customer to customer

Part A
Job Costing
1. Features of Job costing system
According to CIMA, Job costing is a form of definite order costing, which is applied to
work and takes all customers' needs. Some comparative requirements are usually
taken in each of the short duration processes. Specific sets of works are taken in a
short duration form, carried out inside the organization or factory (McDavid et al.
2018). Therefore all the work carried out is usually processed into an identifiable unit.
Therefore the definite set of work is implied to the method used in the costing of
internal "capital expenditure jobs". A specific job unit is usually considered a definite
"order our contract," where different elements are composed of identifiable items
with special requirements. The specific cost of any kind of complete job is usually
carried will be the materials that are used in the job (Hudson et al. 2017). It also
includes the "direct labour employed and production overhead charges" for it.
[Referred to Appendix 1]

Figure 1: Job Costing Overview

(Source:
https://sedonaoffice.perennialsoftware.com/V5Help/7/idh_topic10000_0010.htm)
● It is a definite "Order Costing."
● Generally, the job is carried out where the product is produced for making to
fulfil all the requirements of the selected order. Usually, they are related within
a single unit for different batches of jobs produced.
● It is directly related to the "cost factor ir individual job," which takes some time
to produce it. Generally, it is conducted within a short period.
● All the costs are collected for each of the jobs when it is completed.

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 ● Generally, the jobs are ascertained with "adding of materials, labour and
overheads".
● The "work in progress may also exist at the end of the accounting period.
The general companies usually match with the flow of costs with the physical flow of
definite products. It undergoes the “production process” (Lee et al. 2016). Therefore
the place materials are usually acquired from the "suppliers" present in the materials
storeroom, provided with the cost records of these materials. Some definite needs
are present within the production materials, which comprise different departments. At
the time of production, the materials are usually processed by the "workers and
machines," which transforms into the "partially manufactured products". It is well
known as the "work in process," and the goods are completely known for finished
goods. As the accounting flow of costs usually follows the definite physical flow of a
specific manufacturing process, which is present within many of the companies that
exist (Bray et al. 2019). The cost factors will usually follow the definite physical flow
of the products.
2. Two companies suitable for job costing are Agusta Bell, an Aircraft
manufacturing company, and Rosella, a food company.

Agusta
Bell Rosella

Figure 2: Two Companies using Job costing

(Source: Self-created)
A job costing used by companies like Agusta Bell produces some unique
products or jobs which include airplanes with some advanced technology
systems. The definite job costing system will record every type of revenue and
costs present for each section of the job. The customized appliances used in
every aircraft body are a unique product that requires different types of
material and labour. Therefore the managers usually want to compare the
actual costs present within the estimated cost throughout the projects (Wahab
et al. 2018). It is usually identified with some of the unexpected changes
which usually occurred in early stages. The job order costing is an expensive
process to maintain the all order system. Therefore it is completely associated
with some of the individual material and labour used for some cost associated
programs. As the job order cost system is considered, cost systems are
performed with easy determination. [Referred to Appendix 2]
Rosella is a famous food manufacturing company that also uses the job
costing process. The job order system is usually used by various
manufacturing companies, compromised with the services industries. The
food manufactured companies usually "customized the products and services"

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as per the customers' demand. Therefore the companies like Rosella accept
orders of jobs acquired for various types of products offered to the customers
(Sarma et al. 2020). This situation mainly consists of accepting a cost record
system for each of the "individual jobs," which is kept with different other
products. The per-unit cost of a definite job is usually conducted by dividing all
types of total costs allocated for the job by the set of number units present in
the job system. Different job orders are usually identified that more than 51%
of companies are using the job costing process. The mechanics of job costing
are tested and used in several types of systems where the work is performed
according to the customers' requirements. Therefore the documentation,
material, and labor are usually based on the "Material requisition forms"
(Almeida and Cunha, 2017). As a product costing method, it is considered
that job costing is perfect for many of the researchers.
3 Two potential uses of cost information for decision making
The use of traditional cost accounting in the Agusta Bell company section
uses direct "labour" to allocate all types of overhead costs. Therefore the
systematic distort production costs are visually used in the "advanced
manufacturing environments". It is considered that the overhead costs that are
used in the Agusta Bell company are a significant portion of the overall cost
factors. The main reliability factor rises with the specific "cost information" for
decision making. It is considered an important issue in "cost accounting,"
where the traditional cost accounting system usually fails (Calvi et al. 2019).
Therefore, most airline companies do not use any kind of "ABC Method" for
cost calculations. The main operating costs acquired for individual airplanes
are usually categorized into "direct costs and overheads". Direct costs are
usually considered to be tracing directly to some of the definite "cost objects".
It cannot be changed as per the utilization of any of the cost factors utilized in
tracing these objects. The airplanes manufacturing companies usually acquire
most of the "individual planes" cost information by adding some of the "direct
variable costs". Therefore the cost factors are considered to be very important
for the managers of Agusta Bell Company. [Referred to Appendix 3]

The cost factors usually represent a decisive factor, including making

different types of "decisions making processes". The main record or analysis
is carried for making the perfect decisions or planning procedures for the food
products' future activities. Job costing is provided with factors that meet the
requirements of the customers. Rosella Company changes the products and
services as per the changes in the company and its needs. The managers are
also concerned with different aspects of costs determined with the supply and
production decisions. The managers of Rosella Company are also very much
concerned about all the cost factors that maintain one side of the "cost
accountancy" procedures (Chen et al. 2019). The level of products and
services provided by Rosella Company are measured with the cost
information system's efficiency. The managerial accounting system is also
procured with the whole accounting system, analysed within the "information
system of costs". According to the researchers, "the information system of
costs" is directly directed towards the high degree of detail supporting
planning, control, and decision-making process. There are few sets of plans
that are activated within the financial analysis based on the quantitative
perspectives.

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Part B
1. The costing system is designed with the film Monster production was a
hit in the box office. The company name is Giant Studios, which
brought early stage profit of the success.
According to nscpolteksby.ac.id (2020), the recording made for the cost
of output is perfect for the appropriate business and specialized in
different types of products as per the products' requirements. There are
some separate jobs that are usually conducted within the requirements
of the jobs. Job costing is also appropriate within the business
structure, which is specialized in different products and constitutes all
types of products (Ball et al. 2019). Job costing is also considered to be
perfect for the production house of any films to be produced. All the
costs are charged for using the expense invoice for the appropriate
number of jobs, which can be used as a primary source. There is
enough set of deals that are maintained with the invoice's expenses
and are related within the appropriate job number. All the invoices are
used as the primary source, which is gained from every type of
information which is transferred to the job cost record system.
The total "work in progress" is usually set for checking all the separate
job costs, which is very useful for the total work in progress at any
single time. The total direct labour is mainly used on all sets of jobs and
the total production overhead incurred during the specific set of months
(Hitiraukunga, 2018).
2. The costing system satisfies the Features.
The Job costing system is identifiable in all the stages for its
completion and delivery system. It will allow all the features of
industries that are gained with the usual application for gaining orders
from the customers. There are some specific sets of products that are
also meant for the main stock and future set of sales. Each section of
the job is treated in such a way to ascertain all its "costs and profit"
(Reynolds et al. 2018). Therefore the estimating costs made to the
customers are completely based on its wide practiced. The costing
department usually prepares the cost estimation of each of the jobs
before any kind of quotation price is made to the prospective
customers.

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 Figure 3: Characteristics of Job Costing
(Source:
https://courses.lumenlearning.com/sac-managacct/chapter/characteristi
cs-of-job-order-costing/)
For example, the "job order costing" is Warner Bros, which is a
production movie company where it incurs various types of costs while
processing the making of different movies like "Harry Potter". The main
costs incurred for direct labors usually include the film crew, directors,
editors, and actors. There are many types of overhead costs that also
include the "depreciation of items like equipment, utilities, and wages".
The respective tools are used to help them determine the production
costs of the movies. It will also make a sustainable decision regarding
"studio profit". Therefore allocating a large number of overheads to
any of the "individual firms" will automatically drive down the "reported
profitability" of each kind of firm.
According to "Total Quality Management (TQM)," it is also described
within the "total productive maintenance" for the long term approach to
meet the customer's expectations. The main purpose of "quality
management tools" is to increase the business factors and also reduce
some of the losses due to the insufficient practices from the operations.
It can easily embrace some of the principles like "employee
involvement in the organization and process-centred".
3. Cost information useful to internal users
The internal users which are present within an organization include owners,
managers, and employees. The basic cost information also plays vital roles for every
type of organization within the "decision-making process". It consists of a detailed
"analysis of costs" and the calculation of production cost. The cost information is also
available in the production cost, which is a solid base for different types of financial
control. The main decision process is considered to be an action for the provided
information system, which is supported through "planning, control, and decision
foundation" (Usher et al. 2018). As the decision process is conducted through the
success of the business, which occurs at all the levels of the organization that covers
both the short and long term perspectives. The main plans are activated with the
limited period of decisions which are contributed within the financial analysis or
quantitative one. There are some definite rational conclusion services that are
reached at the top. The main practices of the management systems are also
incurred within the system, which is developed in the decision process.

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The making of decisions is usually conducted through different sets of actions that
change as per the requirements of the customers. There are different sets of costs
that are developed within the relevant decision factors. The main differential cost
factors also improve the decision-making capabilities for internal users like the
managers. The costs can also be avoided if it is influenced by some other factors
which are expected and gained through the additional cost (Goossens et al. 2019).
There are a few alternative sections that are integrated into the differential cost
factors. A definite cost is also irreversible, which cannot be controlled within the
reversible decision taken by the managers.
The influence power of the managers is also implemented on the costs and has the
possible knowledge about ist "cost applications". Generally, the cost is considered to
be irreversible as the managers are not able to return to their employment decision.
Therefore some other solution is required to be adopted and able to install some
irreversible machines for the decision making process. The costs present within the
organization are considered to be controllable for the decision-maker, which has full
power on the occurrence made of the cost section. The definite cost is also
considered to be administered at the requirement of the decision-maker process. A
definite set of hidden costs is already generated and cannot be avoided easily for the
action taken by the managers. The single set of costs is much visible at the presence
of the decision-maker where the actual volume of costs is included.
According to the job cost record it mainly shows the cost of materials, labor, and
overhead costs for the production of any movie. The specific "accounts department"
also knows about the incurred costs which are present within the definite set of jobs.
There are a few issues that arise during the invoice print price, which is charged by
the supplier. There are definite Direct labor costs, which will be calculated by using
different hours worked at the hourly rate of each employee. It is also available from
different types of personal record procedures. It also allows the cost of direct
materials, which is to be recorded according to the materials used in each job. Every
job has an ID number that can be stored in the, and the materials can be easily
traced down to the "job cost record". It is the direct labor costs which will be
calculated within the use of working hours that are shown in each of the job
numbers. There are few Hourly rates that are identified within the available personal
records. There are other direct costs that are charged through entering the employee
timesheet. The other direct costs are easily identified by entering other job costs.
The main production costs will be identified with the sharing of common jobs that are
related to the report.
4. Literature Findings
According to Panattoni et al., 2020, there are multiple sets of persons who all are
suited with the best situation of goods and services produced as per the receipt of
the customer order. There are different types of customer specifications that are
carried with different sets of batches. For example, an aircraft manufacturer, the
order should be clarified to find the "method logical". Therefore different sets of
construction companies are usually carried with the natural approach made through
job costing. Therefore the "materials and labor" can easily be traced down to each of
the jobs. The organizations which are present have very much difficulty regarding the
activity of providing some of the accurate and timely project rates for the respective
clients. Therefore the main process of ensuring the successful projects is also
responsible for the process of tracking and guiding the specific set of performance of
the cost factors. The cost inputs are usually identified within the budget procedures
and committed to the project controller of the project. The information will also

11
provide all types of insights into the trends that are developed in performing the set
of projects. (link.springer.com 2020)
According to Zwijsen et al. 2016, the approach made to the definite budgeting and
approaches are usually based on the projections of consistency of the elements. The
main integration of the cost is the factor that sustained the project controllers. There
are different sets of schedules that tend to work in terms of work breakdown
structures (WBS) for its definite activities. There are different managers who all view
the simple data and schedules, which are often used with different sets of tools to
report the data. There is definite pulling information that is gained from both sides of
challenges. The factors of cost accounting are also relevant to the detailed costing
information. The management is also settled with a different delegation of
responsibilities for the tasks provided by the costs accounts in a specific way. There
is some definite period of trade depression where the organization cannot afford the
losses. Therefore the management also knows all the areas of continuous growth,
which is settled in the actual cost factors. The adequate section of costing will also
guide reliable sources for making some changes in the price levels.

Conclusion
The research paper depicts all the information obtained from job costing. It also
analyses the overhead allocation, which is made for the cost structure of the specific
company and determines all the units of cost of production. There are a few sets of
examinations that are easily related to different sets of components for the unit cost
of products. The main analysis is performed in determining the real cost centres of
the organizations.

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Reference list
Book
McDavid, J.C., Huse, I. and Hawthorn, L.R., 2018. Program evaluation and
performance measurement: An introduction to practice. Sage Publications.
Hudson, S., Salvatierra, C.A.M. and Andres, C., 2017. Evaluating Indigenous
programs: A toolkit for change. Sydney; Australia, NSW: Centre for Independent
Studies.
Journals
Lee, V.S., Kawamoto, K., Hess, R., Park, C., Young, J., Hunter, C., Johnson, S.,
Gulbransen, S., Pelt, C.E., Horton, D.J. and Graves, K.K., 2016. Implementation of a
value-driven outcomes program to identify high variability in clinical costs and
outcomes and association with reduced cost and improved quality. Jama, 316(10),
pp.1061-1072.
Bray, J., Brooker, D., Latham, I., Wray, F. and Baines, D., 2019. Costing resource
use of the Namaste care intervention UK: a novel framework for costing dementia
care interventions in care homes. International Psychogeriatrics.
Wahab, A.B.A., Mohamad, M.H.S. and Said, J.M., 2018. The implementation of
activity-based costing in the Accountant General’s Department of Malaysia. Asian
Journal of Accounting and Governance, 9, pp.63-76.
Sarma, H., Uddin, M.F., Islam, M.A., Rahman, M., Aaron, G.J., Harbour, C., Banwell,
C. and Ahmed, T., 2020. Use of concurrent evaluation to improve implementation of
a home fortification programme in Bangladesh: a methodological innovation. Public
health nutrition, pp.1-11.
Almeida, A. and Cunha, J., 2017. The implementation of an Activity-Based Costing
(ABC) system in a manufacturing company. Procedia manufacturing, 13, pp.932-
939.
Calvi, K., Halawa, F., Economou, M., Kulkarni, R. and Chung, S.H., 2019. Simulation
study integrated with activity-based costing for an electronic device re-manufacturing
system. The International Journal of Advanced Manufacturing Technology, 103(1-4),
pp.127-140.
Chen, H., Tian, Z. and Xu, F., 2019. What are cost changes for produce
implementing traceability systems in China? Evidence from enterprise A. Applied
Economics, 51(7), pp.687-697.
Ball, J., Barker, H., Griffiths, P., Jones, J., Lawless, J.A., Burton, C. and Rycroft-
Malone, J., 2019. Implementation, impact and costs of policies for safe staffing in
acute trusts.
Hitiraukunga, M.K., 2018. Evaluating the implementation of activity-based costing at
the government institutions pension fund in Namibia (Doctoral dissertation,
University of Namibia).
Reynolds, A., Fourie, H. and Erasmus, L., 2018. A framework for time-driven activity-
based costing implementation at small and medium enterprises. The Southern
African Journal of Entrepreneurship and Small Business Management, 10(1), pp.1-
11.
Zwijsen, S.A., Bosmans, J.E., Gerritsen, D.L., Pot, A.M., Hertogh, C.M.P.M. and
Smalbrugge, M., 2016. The cost‐effectiveness of grip on challenging behaviour: an
economic evaluation of a care programme for managing challenging
behaviour. International journal of geriatric psychiatry, 31(6), pp.567-574.

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Panattoni, L., Stults, C.D., Chan, A.S. and Tai-Seale, M., 2020. The Human
Resource Costs of Implementing Autopend Clinical Decision Support to Improve
Health Maintenance. The American journal of managed care, 26(7), pp.e232-e236.
Usher, R., Cronin, S.N. and York, N.L., 2018. Evaluating the influence of a
standardized bedside handoff process in a medical–surgical unit. The Journal of
Continuing Education in Nursing, 49(4), pp.157-163.
Goossens, Y., Wegner, A. and Schmidt, T., 2019. Sustainability assessment of food
waste prevention measures: review of existing evaluation practices. Front. Sustain.
Food Syst, 3, p.90.
World Health Organization, 2018. Meeting of the implementation Core Group of
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implementation tools and joint TB and HIV programming to scale up TB preventive
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Online articles
link.springer.com (2020), job costing, Available at:
https://link.springer.com/content/pdf/10.1186/s12913-020-05204-7.pdf [Accessed on:
01/01/2020]

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Appendices
Appendix 1: Managerial Accounting

(Source: https://businesspromotionstore.com/managerial-accounting/)

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Appendix 2: Job Costing Feature

(Source: https://www.slideshare.net/ravi78/tallyerp-9-job-costing-ver-10)

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Appendix 3: Job Order Costing

(Source: https://slideplayer.com/slide/11039879/)

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