Activity Based Costing (ABC) Advantages and Disadvantages

Activity Based Costing (ABC) Advantages and Disadvantages Activity Based Costing which is popularly known as ABC system has been considered as an economic map of an organizations expenses and profitability based on organizational activities according to Kaplan R; and Cooper R. An activity is an event, task or unit of work with a specified purpose, for instance, designing a product, setting up machines, operating machines, and distributing products; by Horngren, Foster, Datar. According to Kaplan R.S Cooper R; ABC system came in the mid-1980s to meet the need for accurate information required by managers about cost of resources demanded by individual products, services and customers. It emerged as competition moved from local to global and from the efficient use of direct labour and machines. Absorption Costing also known as full costing is a traditional costing system developed in the 1900s, by which overheads incurred within a period were absorbed into the products by Kilgour D. The traditional absorption costing was introduced at a time when technology was simpler, competition was local, products were standard and not customised products and services, speed, quality and performance were not measurement for success in reference to Kaplan R.S Cooper R. Importance of Absorption Costing System or Activity Based Costing: According to Horngren, Foster Datar, the importance of a costing system should depend on whether the company is producing one type of product and therefore could allocate all overhead costs using one cost pool and one cost rate or whether the company is producing different kind of products and therefore need a system which could enable it apportion the total cost of resources accurately according to their usage of those resources. As companies began to expand and delve into producing variety of products, they began to notice that some products place more demand on their resources than others. It became important to absorb overhead when products which are not the same but required different production processes or jobs which although the use the same facility but at a length of time according to Terry L. To ascertain how to apportion overheads to products or services, traditional absorption costing involves two stages; the first stage is the allocation and apportionment and the second stage is the use of absorption rate to absorb overheads into products. Overhead Allocation: Terry L; overhead allocation is the assignment of all cost incurred to a single cost unit, centre account or time period. Overhead Apportionment: This is a case where the costs incurred could not be identified with only one cost centre therefore the cost is shared between the cost centres using that service, for instance, lighting cost would be shared between all the cost centres using a suitable basis, Terry L. It is important that the basis upon which costs are apportioned are relevant, fair and equitable; Terry L. Overhead Absorption Rate: This is usually calculated at the beginning of a period therefore it is based on budgeted costs and production volumes, AAT units 89. The formula is as follows: Total overheads of cost centre Total number of units of absorption base applicable to cost centre According to Terry L; before calculating absorption rate, the absorption base chosen has to reflect the characteristics of the given cost centre. The basis most commonly used are direct labour hours for a labour intensive cost centre and the machine hour basis usually used where the cost centre is highly mechanised. With exception of the above two basis, other basis include; Direct wages, Direct material, Prime cost and Cost unit. ABC System: Activity Based Costing began in a manufacturing setting but has been more service -oriented than product oriented. Service Industries as much as manufacturing industries need ABC system to connect the cost resources they supply to the revenues earned by the individual products and customers serviced by these resources in reference to Horngren, Foster Datar. ABC System has three key features are: (1) With the system all costs used by a product whether variable or fixed in the short-run or overheads(indirect costs)in the long-run are identified by creating cost pools as ABC is focused on long-run variable costs for instance as Terry L; said, costs for supporting activities like stock handling, production scheduling and so on. Cost Pool: Classifying all related costs to a particular activity together according to Terry L. (2) The second feature of ABC system is; An amount of an activity performed in each cost pool is recognised as a basis of allocation for instance, set-up hours as a measure of set up activity. Horngren, Foster, Datar. (3) The third feature is that costs in a cost pool can sometimes be traced directly to products. Horngren, Foster, Datar. The Differences Between Traditional Absorption Costing and Activity Based Costing. The differences between the two costing system are easy to notice. Below are lists of some of them: The traditional absorption costing was introduced at the time when technology was simple, there was only local competition and not global, when products were standard not customised, from Kaplan S.R Cooper R. ABC system emerged at the time when competition had become global and fierce and had shifted from the efficient use of labour hours and machines, by Kaplan S.R Cooper R. The traditional costing uses mostly two allocation bases to allocate overheads to products; direct labour basis for a labour intensive company and the machine hour basis for a highly mechanised company. These two bases would not capture the demand of a particular product on the resources of the organisation. There are no cause and effect relationship to an allocation base with the use of this method, Horngren, Foster, Datar. With ABC system, costs of activities within the organisation are more accurately measured because the cost pools are properly structured with specific activity cost allocation bases which became cost drivers for the cost pool. Cost Driver: factor influencing the level of cost from Terry L. In the traditional absorption system, absorption rates are based on predetermined figures thereby giving rise to under and over absorption of overhead. Under absorption arises when the estimated overhead is less than the actual overhead. Over absorption of overhead arises when the overhead absorbed exceeds the actual overhead ; from AAT Study text units 89. The measurement required to implement ABC system are costly as the system demands that management should estimate costs of activity pool, identify and measure cost drivers for the cost pools to serve as allocation bases; from, Horngren, Foster, Datar. The use of ABC system will require its activity cost rates to be updated regularly and a detailed ABC system consumes time, is difficult to understand and operate, Horngren, Foster Datar. Illustration : As an illustration of the differences between traditional absorption costing and activity based costing,with attention to set up activity, the effect of allocating all overheads using direct labour hours as against an ABC emphasis on individual activities, the name of the company shall be called Z. Z produces two kinds of lenses for an automobile company. The first product is a simple lenses, the second product is called complex lenses. Set ups involves trial runs, fine tuning, adjustments, wrong set-ups cause quality problems such as scratches . Each set-up requires different resources depending on the complexity of the operation. Complex lenses are produced in small batches because the mold has to be cleaned more often. Horngren, Foster Datar. According to Horngren, Foster, Datar, set-up data for simple lens and complex lens are: Simple Complex S3 lens CL5 lens Total (1) Quantity produced 60,000 15,000 (2) Lens per batch 240 50 (3) No of batches (1/2) 250 300 (4) Set-up time per batch 2hours 5hours (5) Total set-up hours (3)*(4) 500hours 1500hours 2000hours Direct manufacturing labour hours 30000hrs 9750hrs 39750hrs Z recognises total cost of set-ups comprising of allocated costs of process engineers, supervisors, set-up equipment of  £300,000. Solution: The table below shows how the set-up costs have been allocated to simple and complex lenses using direct labour hours and setup hours: Setup cost per direct labour hours: (300,000/39750)= £7.54717 Setup cost per setup hours: (300,000/2000)=  £150 Simple Complex Total S3 lens CL5 lens Cost allocated using direct labour hrs:  £7.54717* 30000;  £7.54717*9750  £226,415  £73,585  £300,000 Cost allocated using setup hrs:  £150*500;  £150*1500  £75,000  £225,000  £300,000 Implementing the Activity Based Costing System: The choice of implementing Activity Based Costing depends on the managers after evaluating the advantages and disadvantages, controlling the amount of details required and cost. ABC system enables management to see their existing and predetermined cost of activities and business processes which then equips them with knowledge of the cost and profitability of the various products, services, customers and operating units according to Kaplan S.R, Cooper R. There are several steps the company could take to change the existing costing system. These are: Step 1: List all the activities of the company performed by indirect and support Resources, for instance, material handling, schedule production and so on. Step 2: Find out how much the company is spending on each activity in the company. Step 3: Indentify the companys products, services and customers, Kaplan S.R, Cooper R. Step 4: Charge support overheads by their usage of the activity with emphasis on the Cause-effect relationship. Recommendation: ABC system is recommended since it provides more accurate product Costs. The system has been used successfully in some service industries Such as the Cooperative Banks to identify profitability, product mixes, Improve efficiency and satisfy customers, Horngren, Foster Datar.

Bedstones Gentrification Essay -- Papers

Bedstone's Gentrification Firstly I feel it would be a very sensible idea to write down my definition of gentrification, as at the end of the day that is what this coursework is about. "Conversion and renovation of redundant farm buildings into dwellings or different crafts by changing the structure (faà §ade) of them to get it up to date, essentially modernisation. This is often done by wealthier people moving in from the outside community and results in a raise of the settlements' socio-economic status, i.e. the community goes from a working class one into a middle class one due to people moving in. Also there is a change of a villages' function\ purpose to its community." However, has Bedstone undergone gentrification at all? Yes, I feel it has and by quite a considerable degree. Using my definition above I will investigate the many factors involved to come to an intelligent decision. Bedstone originated as an agricultural functioned village and the local area was covered with working farms. The population was also quite large, much more than it is today (at its highest in 1821 it was 165). This is backed by the variety of industry that was stationed here in the late 19th and early to mid 20th century. The village population was able to support a diary (1876- approx 1940's), a school until the 1940's, an inn until the 1930's, a blacksmith and a carpenter. The village used to be a bustling agricultural village, which through time has slowly diminished. Numbers have fallen steadily to the present day and is only now are they starting to grow. Now the village is solely a residential functioned village with no shops, inn, .. ... relatively new resident of the village has told me of further developments around the village indicating further gentrification and growth of the village. Unfortunately this further development will bring many problems with it, too numerous to mention and it is unclear what the future holds. However what is clear is that gentrification has happened in Bedstone and to a considerable degree, which hopefully has been shown. Bedstone has been through the whole process of gentrification of conversion and renovation of buildings, a rise in its socio-economic class, as well as a massive influx of people from the outside community. The trend is still going strong and I see no reason why the factors just mentioned won't continue far into the future. We should ask ourselves however, what does the future hold for Bedstone?

Gender Development

Gender shapes the lives of all people in all societies. The term ‘gender’ refers to the social construction of female and male identity. It can be defined as more than biological differences between men and women. It includes the ways which those differences, whether real or perceived, have been valued, used and relied upon to classify women and men and to assign roles and expectations to them (http://en. wikipedia. org/wiki/Gender_and_development). Gender influences our lives, the schooling we receive, the social roles we play, and the power and the authority we command. Population processes – where women and men live, how they bear and rear children, and how they die – are shaped by gender as well (Riley, 1997). Several theories of gender development have generated most of the research during the past ten years: social learning theory, cognitive-development theory, and gender schema theory. Proponents of social learning theory believe that parents, as distributors of reinforcement, reinforce appropriate gender role behaviors. By their choice of toys, by urging boy or girl behavior, parents encourage their children to engage in appropriate gender-related behavior. Thus children are reinforced or punished for different kinds of behavior. They also learn appropriate gender behavior from other male or female models such as those in television shows. A second explanation, quite popular today, is found in cognitive-development theory, which derives from Kohlberg’s speculations about gender development. It is known that from Piaget’s work that children engage in symbolic thinking by about 2 years of age. Using this ability, Kohlberg believes, they begin the process of acquiring gender-appropriate behavior. A newer, and different, cognitive explanation is called gender schema theory. A schema is a mental blueprint for organizing information, and children develop gender identity and formulate an appropriate gender role. Consequently, children develop an integrated schema or picture, of what gender is and should be (Elliott et al. , 1996). Gender and Power Gender refers to the different ways men and women play society, and to the relative power they wield. While gender is expressed differently in different societies, in no society do men and women perform equal roles or hold equal positions of power. Power is basic fabric of society and is possessed in varying degrees by social actors in diverse social categories. Power becomes abusive and exploitive only when independence and individuality of a person or group of people becomes so dominant that freedom for the other is compromised. Women and children have open been on the abusive sides of power. Some causes that are often referred to are: the greater the physical strength that men tend to have creates the imbalance of power between men and women resulting from social structures and historical practices in regard to finances, education, roles of authority and decision making; the abuse of power by men and the failure of cultural pressures to prevent such abuse; and distorted view the sexuality and the objectification of the female. Max Weber in his ‘Essays in Sociology’ defined power as the likelihood a person may achieve personal ends despite possible resistance from others. Since this definition views power as coercive, Weber also considered ways in which power can be achieved through justice. Authority, he contented, is power which people determine to be legitimate rather than coercive. As a group, women are at a distinct advantage when considering both power and authority. Several factors act as determinants of the amount of power a person holds or can use in his/her relations with others: status resources, experience, and self-confidence. Males and females traditionally have had differing amounts of power at their disposal. By virtue of t6he male’s greater ascribed status in society, men have more legitimate power based on rank or position than do women. The serious social issue today is the relative inequities in social power between men and women. The issue of women’s power, relative to men, is not merely academic. Gender differences in power have real consequences for women. For example, although women have made significant gains in the workplace, with more women working than in the past and women possessing approximately a third of all management positions, women continue to experience wage discrimination, be excluded from the most powerful executive positions, advance more slowly in their careers, and experience fewer benefits from obtaining education or work experience, and are included in fewer networks and exert less authority (Colwill; Lyness and Thompson, 1997) than men in similar positions. A number of researchers have linked career advancement and access to benefits and resources within organizations to an effective use of power. An understanding of women’s power, relative to men, is therefore essential to overcoming women’s disadvantage in the workplace and other domains (http://www. find articles. com/p/articles/mi m0341/ is 1 55/ai 54831711). Gender and Education The past decade has witnessed a significant increase in the importance accorded to education, with both instrumental as well as intrinsic arguments made for increasing financial investment and policy attention to education provision. Investing in education is seen as one of the fundamental ways in which nation states and their citizens can move toward long-term development goals and improve both social and economic standards of living. The education of women is seen as providing the key to securing intergenerational transfers of knowledge, and providing the substance of long-term gender equality and social change. Although significant gains have been made in women’s education as a result of global advocacy, more often than not the gains are fragile, vulnerable to changes in economic and social environments, and lagging behind in male rates of enrolment and achievement. Achievements are particularly visible in the primary education sector, whereas gaps are still large in the secondary and tertiary sectors (unrsid. org/inrisd/website/nsf). Schools also reinforce gendered social roles. Researchers have documented the differential treatment accorded males and females in the classrooms that reinforces a sense of inferiority and lack of initiative among female students (Sadker and Sadker, 1988). Boys are far more likely to be given specific information that guides improvement of their performance (Boggiano and Barrett, 1991).

Babson College (GPA, SAT and ACT Scores for Admission)

Babson College (GPA, SAT and ACT Scores for Admission) Babson College GPA, SAT and ACT Graph Babson College GPA, SAT Scores and ACT Scores for Admission. Data courtesy of Cappex. How Do You Measure Up at Babson College? Calculate Your Chances of Getting In  with this free tool from Cappex. Discussion of Babsons Admissions Standards: Far more applicants are rejected than accepted by Babson College. Successful applicants will need to have standardized test scores and high school grades that are well above average. In the graph above, the blue and green dots represent accepted students. You can see that most successful applicants had high school grades in the B / A- range or higher. Admitted students tended to have combined SAT scores of 1250 or higher (RWM), and ACT composite scores of 26 or better. Strong math scores are particularly important at Babson. Note that there are quite a few red dots (rejected students) and yellow dots (waitlisted students) mixed in with the green and blue in the middle of the graph. Many students with grades and test scores that were on target for Babson College did not get in. Also note that a few students were accepted with test scores and grades a bit below the norm. This is because Babsons admissions process is based on more than numbers. The college uses the Common Application and has holistic admissions. The admissions folks will be looking at the rigor of your high school courses, not just your grades. Also, they will want to see a winning essay, interesting extracurricular activities, an engaging short answer, and strong letters of recommendation. You can further strengthen your application by doing an optional interview, and all applicants must do a supplemental essay in the form of a letter to your Babson roommate. To learn more about Babson College, high school GPAs, SAT scores and ACT scores, these articles can help: Babson College Photo TourBabson College Admissions ProfileWhats a Good SAT Score?Whats a Good ACT Score?Whats Considered a Good Academic Record?What is a Weighted GPA? Articles Featuring Babson College: Top New England Colleges and UniversitiesTop Massachusetts CollegesBoston Area Colleges If You Like Babson College, You May Also Like These Schools   Bryant University:  Profile  |  GPA-SAT-ACT GraphVillanova University:  Profile  |  GPA-SAT-ACT GraphStonehill College:  Profile  |  GPA-SAT-ACT GraphUniversity of Connecticut:  Profile  |  GPA-SAT-ACT GraphFordham University:  Profile  |  GPA-SAT-ACT GraphProvidence College:  Profile  |  GPA-SAT-ACT GraphNortheastern University:  Profile  |  GPA-SAT-ACT GraphGeorgetown University:  Profile  |  GPA-SAT-ACT GraphBoston College:  Profile  |  GPA-SAT-ACT GraphUniversity of Pennsylvania:  Profile  |  GPA-SAT-ACT GraphNew York University:  Profile  |  GPA-SAT-ACT GraphBentley University:  Profile  |  GPA-SAT-ACT GraphDrexel University:  Profile  |  GPA-SAT-ACT Graph

The eNotes Blog The Magic of MarquezRemains

The Magic of MarquezRemains Many of you have probably already read the sad news this week that celebrated Colombian author Gabriel Garcia Marquez is suffering from dementia. At the age of 85, it is apparent that the Nobel Prize winner’s career is for all intensive purposes at an end. The accounts of this news have already lamented that his memoirs will likely remain unfinished, and noted the sad foreshadowing laid out by the opening of One Hundred Years of Solitude (the novel deals with a family struggling to care for its patriarch, also suffering from dementia), so I will not comment anymore on that. Instead, I decided to take a look back at an old interview with the author at the height of his magical realist powers. What I found was a conversation printed in a 1981 edition of The Paris Review, just before Garcia Marquez won the Nobel Prize. In it, I was surprised to read the writer’s perception of the role reality takes in his work, and the influence journalism has had on his career in fiction. The author even comments on what it would be like to win the Nobel Prize (â€Å"a catastrophe†amusing, given that he won it less than a year later) and details his plans for the future. In all, the interview reminds us that Gabriel Garcia Marquez and his work are still very much with us. He may never write another word, but the magic of his work will always remainready to be discovered anew, as I found hereand that is what I choose to remember now in the face of this sad news. Below are some interesting excerpts from the authors conversation with The Paris Review. On how he began writing: One night a friend lent me a book of short stories by Franz Kafka. I went back to the pension where I was staying and began to read  The Metamorphosis. The first line almost knocked me off the bed. I was so surprised. The first line reads, â€Å"As Gregor Samsa awoke that morning from uneasy dreams, he found himself transformed in his bed into a gigantic insect. . . .† When I read the line I thought to myself that I didn’t know anyone was allowed to write things like that. If I had known, I would have started writing a long time ago. So I immediately started writing short stories. How he developed the writing style of magical realism by way of his grandmother’s storytelling: What was most important was the expression she had on her face. She did not change her expression at all when telling her stories, and everyone was surprised. In previous attempts to write  One Hundred Years of Solitude, I tried to tell the story without believing in it. I discovered that what I had to do was believe in them myself and write them with the same expression with which my grandmother told them: with a brick face. On the surprisingly close relationship he believed his work shared with reality and journalism: In journalism just one fact that is false prejudices the entire work. In contrast, in fiction one single fact that is true gives legitimacy to the entire work. That’s the only difference, and it lies in the commitment of the writer. A novelist can do anything he wants so long as he makes people believe in it†¦ Pablo Neruda has a line in a poem that says â€Å"God help me from inventing when I sing.† It always amuses me that the biggest praise for my work comes for the imagination, while the truth is that there’s not a single line in all my work that does not have a basis in reality. The problem is that Caribbean reality resembles the wildest imagination. †¦ many people believe that I’m a writer of fantastic fiction, when actually I’m a very realistic person and write what I believe is the true socialist realism. When asked about his ambitions and regrets, he responds: I was asked the other day if I would be interested in the Nobel Prize, but I think that for me it would be an absolute catastrophe. I would certainly be interested in deserving it, but to receive it would be terrible. It would just complicate even more the problems of fame. The only thing I really regret in life is not having a daughter. Looking towards the future: I’m absolutely convinced that I’m going to write the greatest book of my life, but I don’t know which one it will be or when. When I feel something like this- which I have been feeling now for a while- I stay very quiet, so that if it passes by I can capture it.

Java PROGRAMMING Essay Example | Topics and Well Written Essays - 250 words

Java PROGRAMMING - Essay Example In a structured programming language, the outright benefit and advantage is that it helps the programming setup to minimize complexities. This logic and line of thought stems from the fact modularity would help a programmer to solve and confront the problems in a reasonable manner and fashion. It is needless to stress and over-emphasize the fact that once the logical structures are streamlined, the flow would be seamless and thus a programmer would have more clarity when dealing with data (Hughes, 2009). Secondly, there are the prospects of increased productivity because the modularity allows a programmer to work on several different projects concurrently. This is to imply and say that the modules may be engaged and re-used many times, thus reliability and dependability would be improved. Subsequently, time and costs would be saved since it is far much easier to replace the singular modules rather than a huge amount of codes (Hughes, 2009). A practical case and instance of an application is the Java Programming which is an object-oriented language. This stems from the fact that it a language used to serve the purposes outlined above in the name of merits and

Do police crack downs reduce drug related violence Essay

Do police crack downs reduce drug related violence - Essay Example Violence results from individual and group use in drug markets and drug producing areas as the drug gangs strive to maintain and control a share of the lucrative illicit market of drugs is considered as one of the origin of murder cases experienced (Shepherd, 2005).. Cases of individual drug users committing murder is also common like violence resulting from drug induced psychosis. As the authorities strive to curb the problem of drug trade, the rate of violence increase significantly as this increased militarization of the criminal elements and law enforcers means both parties are easily accessed to lethal weaponry as they fight to outdo the other. Recent scientific evidence suggests that the prohibition of drug is the likely contributor of drug market violence and the increased homicide rates (Martin, 2009). Basing on these findings, we might conclude that increasingly sophisticated methods of dealing with drug distribution networks hikes the level of drug-related violence. The removal of the drug loads from the lucrative illegal drug market by law enforcers may have adverse effects as other individuals will strive to fill the vacuum by entering the market. The rise in murder cases might also be attributed to the enormous profits generated from the selling of drugs which is used to destabilize governments and creation of heavily armed rebel groups, for example, the U.N. estimated gains from illicit drugs to be approximately US$320 annually which is entirely outside the government controls and likely to fuel crime, corruption, and violence in urban areas (Blumstein, 1995). Recent reviews show that interventions of drug law enforcement may reduce the rate of drug related violence. However, the existing scientific evidence has strong suggestions that prohibition of drugs may likely cause violence and more homicide in the drug market. Contrary, conventional wisdom believes that drug law enforcement is likely to reduce this violence. Therefore, the association