These cost accounting manuals describe traditional product costing practices, namely, job order costing, standard costing, and direct costing.
The computer program is intended to calculate a company's product cost and to create competitive bids for quotes and is based on traditional costing principles using job order costing that allows companies to maintain separate records for each quote request that can be archived and recalled at a future date to assist in preparing quotes for similar products in the future.
Job order costing is typically covered in cost accounting and managerial accounting courses and appears in virtually all such textbooks (e.g., Hilton, 2005; Schneider, 2009).
Although other approaches have used LEGO[R] blocks to teach management accounting terms and techniques (Roth, 2005; Morgan, Martin, Howard, & Mihalek, 2005; Burns & Mills, 1997), this simulation is different in two major ways: (1) it focuses solely and comprehensively on job order costing whereas previous articles have only superficially covered job order costing, and (2) by using the variety of materials called for in this simulation, the product and manufacturing process is more realistic, affording the students the ability to clearly see the differences between direct materials and indirect materials, direct labor and indirect labor, and other items that constitute manufacturing overhead.
How did this project compare to learning about
job order costing by reading the book?
The final section covers traditional managerial accounting topics of classifying costs,
job order costing, direct and absorption costing, and standard costing.
I was able to identify more technical themes that lent themselves to self-directed learning (
job order costing, process costing and standard costing, for the technical portion) and other themes that could be studied in theme-based simulation exercises (cost behaviour, actual cost, budgeted cost and standard cost for the portion devoted to variance analysis).
The accountant asks to look at the
job order costing system to try and find an answer.
This month we'll continue with a discussion of the specific methods of cost accumulation using
job order costing.
The managerial accounting chapters tested are those covering: the introduction;
job order costing; and, master (operational) budgeting.
* Assigning costs to customized procedures (
job order costing)
The two traditional methods of product cost accounting are
job order costing and process costing.
