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Minute session 8 .docx - EBC 1009 GROUP 37 MINUTES MEETING...

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EBC 1009 GROUP37MINUTESMEETING8:08.12.2016Discussion leader: JadeSecretary: Giorgio, victor1. Learning goals1)What is cost behaviour? Why would it be important?
2)There are different (cost behaviour) methods : Which are they ?2.1INDUSTRIAL ENGINEERING METHODa.estimates cost functions by analysing relationship between inputs and outputsin physical termsb.time-and-motion studies analyse time and material required to performoperations & produce outputc.standards & budgets transform physical input and output measures into costsresult: cost function relating total manufacturing costs to cost driverd.time-consuming, costly, difficult to specify physical relationships betweeninputs and outputs for individual overhead cost items2.2CONFERENCE METHODa.estimates cost functions on basis of analysis and opinions about costs andtheir drivers gathered from various departments of organisationb.usage: to price products, adjust product mix to be more profitable, monitor &measure cost over timec.quickly to create cost functions, extra credibility due to pooling of knowledge,accuracy depends on care taken by people involved2.3ACCOUNT ANALYSIS METHODa.estimates cost functions by classifying cost accounts in the ledger as variable,fixed or mixed with respect to identified cost driverb.widely used, subjective approach because classification depends onknowledge of person doing it2.4

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Term
Summer
Professor
NoProfessor
Tags
UCM

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