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Cost and Revenues - Assignment

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Added on  2020-12-24

Cost and Revenues - Assignment

   Added on 2020-12-24

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Costs and revenues
Cost and Revenues - Assignment_1
Table of ContentsINTRODUCTION...........................................................................................................................1MAIN BODY...................................................................................................................................11.1 Purpose of internal reporting and giving accurate information.............................................11.2 Relationship among various costing systems within M&S..................................................11.3 Responsibility centres, cost centres and investment centres within organisation..................21.4 Characteristics of different cost classifications and their usage............................................21.5 Difference between marginal and absorption costing............................................................32.1 Record Cost information for material, labour and expenses in accordance with the costingprocedures of M&S......................................................................................................................32.2 Analyse cost information for material, labour and expenses in accordance with the costingprocedures of M&S......................................................................................................................32.3 Different stages of inventory.................................................................................................42.4 Value inventory using............................................................................................................42.5 Behaviour of costs..................................................................................................................72.6 Recording cost information....................................................................................................83.1 Attribute overhead costs to service and production costs......................................................83.2 Overhead absorption rate.......................................................................................................83.3 ................................................................................................................................................93.4 Reviewing allocation, apportionment and absorption methods...........................................103.5 Resolving queries in overhead cost......................................................................................104.1 comparison of actual costs with budget costs......................................................................104.2 Analyzing the variances.......................................................................................................104.3 Providing information to budget holders of any variances and remedial actions................114.4 Management report..............................................................................................................125.1 Future income and costs estimates.......................................................................................135.2 Effects of changing activity levels on unit costs..................................................................145.3 calculating the effects of changing activity levels on unit cost...........................................145.4 Factors affecting long-term and short-term decision making..............................................14CONCLUSION..............................................................................................................................15REFERENCES .............................................................................................................................16
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INTRODUCTIONCosting and revenue generation are two major and key aspects within an organisation thatwill support the effective management of financial conditions within a firm. It helps theorganisations to monitor and manage their monetary based operations and handling differentinventories. It is also important to control the expenses that are been carried out within a firm.The report is based on inventory and cost management of UK based retail enterprise, Marks andSpencer. It is one of the largest retail enterprise in world with an effective management of largenumber of inventories.The assessment carries the assessment of internal reporting and providing accurateinformation with different costing systems. The responsibility centre, profit centre withevaluation of investment centres and classification of different costs. Also, the costingprocedures and expense management is been performed with various stages of an inventory andmanagement of different behaviours also the cost information is been evaluated. The overheadcosts will be analysed and measures of allocation, appointment and absorption is taken withresolving of queries art cost data. Budgeting and management reports are presented withassessment of various information for decision making and effects of changing activity levels.MAIN BODY1.1 Purpose of internal reporting and giving accurate informationWithin an organisation, in order to have a good accessibility and management of theircost operations and inventories, the internal reporting of various operations is very essential. Thisprocess is carried out by almost all the organisation in order to have a significant control overtheir operations and management of all sort of expenses. It helps to monitor data redundancy, predicting future trends, identifying the resourcevalues and reduce chances of errors. This is vital for suitable decision making and carrying out ofdifferent inventory management operations (Yang and Chen, 2018). The delivery of accurateinformation helps to improve decision making and increase efficiency of an organisation'smanagement to deliver their services. 1.2 Relationship amongvarious costingsystemswithin M&SDifferent costing systems are taken within the organisation that helps the firm to improvethe quality of services and improve the quality of services and maintain their expenses within anorganisation. The Unit costing measures the production of an individual unit of a commodity,
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using it the batch costing is been estimated. Job and Contract costing will be analyses withprocess costing in order to identify the expense of producing a product or services. Other thanthis, the service costing and composite costing will help in improving the qualities and servicesrelated top the production or manufacturing and helping to evaluate the proper inventorymaintaining of the firm.1.3 Responsibility centres, cost centres and investment centres within organisationThe responsibility centres are the section of an organisation which are looked after tohandle any sort of responsibilities within organisation and thus facilitates an effective decisionmaking authorities and individual managers (Weisbach, Hemel and Nou, 2018). In Cost centres,the financial operations are undertaken by managers and are responsible for the cost managementbut not the revenue generation of the firm.Investment centres, on the other hand, are responsible for both profit or revenuegeneration and resources that are invested as an asset within an organisation. It also helps inmanagement of different inventories and facilitates buying, selling and using divisional assetswithin an organisation.1.4 Characteristicsofdifferent costclassificationsandtheir usageVarious costs are been classified as per the significance and functionality and their chargeagainst revenue. Some major cost classifications with their usage and characteristics are:CostCharacteristicsUsageManufacturing costIt includes the cost of raw materials,labour and factory overhead cost.It is used to identify the cost ofconverting raw material withinfinished goods.Non manufacturingcostIt involves the expenses of advertising,salaries and various commissions ofsellers. It helps the management toidentify the additionalexpenses that are required tobe managed within a firm(Nguyen, 2018).Direct costIt can be induced or identified directlyfor a product, batch or department.It assists in identifying theinevitable expenses for aparticular product.Indirect costIt cannot be traced for a particularThey assist in identifying the
Cost and Revenues - Assignment_4

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