MBA ACCOUNTING QUESTIONS

Running Head : Cost Accounting

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These measures are the principle measure of performance in the control and motivation of managers . However , they are applicable differently in different centers within the organization , depending on whose affect each measure would affect

Cost center it 's an organization performance measure which allocates the firms activities relative to the cost expenditure which is incurred in their performance , i .e . cost is incurred (Hawkins , 2006 ) Firm cost may be purchase of raw materials , manufacturing , distribution and sales

cost in which case these are represented by building products distribution of products , marketing and sell of products . The building product cost include percentage first time quality , actual versus planned production cost and unit cost , distribution of product cost which comprise time costs and days supply of finished good costs While marketing and sell products include sales forecast accuracy

Profit center is the center in the organization , which attracts profit revenue . These include market share percentage , sales dollars and percentage growth sales forecast accuracy which is basically variables in the market and sell of products . Either , in line with shareholders satisfaction profit centers are cash flow from operations profitability and return on assets

Investment centers are related to investment protocols within the organization , these relates to design of products which comprise of averages time to market for new products and new products sales as a percentage of comprises of percentage first time quality , actual version planned production and unit cost . Both employee and customer satisfaction form an important aspect in investment decision shareholders satisfaction from investments is part of investment center , which captures cash flow from operations profitability and return on assets

This structure shows diversity in the reporting structures in most of the firms . In relation to their percentages we can commend that variation of these percentages also shows the importance and efficiency relating to the different centers in manufacturing firms . From the survey it can be revealed that profit centers are more delicate and important compared to others and higher efficiency is needed in their reports . However , cost and investment centers are relatively of a lesser concern in their reporting with cost center reporting been the least minimal . This percentage perhaps indicates the efficiency in these different centers where revenue center can be voted as the most efficient

3 . Transfer pricing is a system used by firms to achieve some certain conditions from the market share . With market price less 10 the aim of the firm would be to sell commodities at a lower price and capture a bigger volume of sales . This would depend on the revenue objective of the firm . With this decision a lower sales price will attract more customers which implies more products purchase and hence an increased sales (Hawkins , 2006

With full cost plus 5 this implies an increased market price of the product . Such an incidence would imply lower products volume sales but which should attract higher unit price (Hawkins , 2006

Both of decisions relate...