Accountancy & Financial matters Management blogs

                Records management or keeping safe for future use is a management skill which helps the individuals and companies secretarial and managerial staff to manage their official and financial records efficiently. Many times we need a file or any other important documents and we are trying hard to find that but due to our miss management, we are unable to find it that shows us how we are incapable or unable to perform in our managerial skills and abilities?                 There are many very easy ways to manage financial and professional records. We can use Microsoft Office Application software for this purpose. That helps us to manage our complete financial and important documents records at a single location. Microsoft Access, Excel, and documents can be used for this purpose. I prefer to use the Microsoft Excel for making a DBMS (Data base management) file for that purpose.                 Before going to start the financial record file making keep in mind the

                Managerial Accountant uses the Factory Over Head Cost to complete their productions and improves their product quality and efficiency. The FOH actually means the costs which are not directly related to the production or manufacturing activity but that cost we need to complete the product and make it more efficient or effective in quality to use. There are three different portions of the Factory Overhead Costs. These portions are Material Overhead, Labor Overhead, and Utility Overheads. These Material and Labor overhead costs are indirect and not directly involved in the production. The material that indirectly supports the production is known as material overhead, the labor supports which indirectly support the complete activity to improve the time efficiency is known as labor overhead and the utilities like insurance, rent, depreciations and many more expenses like it are known as factory overhead costs. The Formula normally used for Factory Overhead Cost is a

                   Managerial Accountants using the absorption and variable costing methods in their accounting but before going to explain both methods we need to understand the Factory Over Head or FOH Costing. The FOH is based on those indirect direct material, indirect direct labor and Utility Costs which support the manufacturing department in production indirectly. Managerial Accountants using two different methods to use the FOH and manage their manufacturing activities that methods are known as Absorption or Full Costing methods and Variable or Direct costing methods. Absorption Costing:                 Absorption Costing is a method of costing which is normally used by managerial accountants during their manufacturing concerns accounting. Most people can know it as full costing. The Absorption Costing has many features which are very important to know for everyone before moving further to memorize the complete concept about it. These features are as follows: ·  

 According to this method determination of the gross margin percentage for all of the products. When we find out the overall gross margin percentage and subtract the appropriate gross margin form the final sales value of each product to calculate total costs for the product and at last to subtract the separate costs to arrive at the joint cost amount. Determination of the gross margin. “ Gleim’s   book 15 th edition for the CMA-USA students and Professionals  is the source of all the examples and this topic” 

 According to this joint cost allocation method, there is a variation of the relative sales value method. The difference is total under the NRV method all costs which are already separate necessary to make the product saleable are subtracted before the allocation is made and then multiplied by joint cost. For explaining this method we have many examples but the example which I am going to give there that is from the Oil sector. The Oil rigging is a process to produce the oil which a natural resource but during the producing process there are many other by products which we abstract from this process the oil companies use the same resources but with the different production costs which are actually joint costs with each other. That example helps us to understand these methods. “ Gleim’s   book 15 th edition for the CMA-USA students and Professionals  is the source of all the examples and this topic” 

 Sales-Value at split-off method is based on separate products relative proportion of total sales value ultimately attributable to the period of production and the resultant is multiplied by total joint cost. For explaining this method we have many examples but the example which I am going to give there that is from the Oil sector. The Oil rigging is a process to produce the oil which a natural resource but during the producing process there are many other by products which we abstract from this process the oil companies use the same resources but with the different production costs which are actually joint costs with each other. That example helps us to understand these methods. “Gleim’s  book 15 th edition for the CMA-USA students and Professionals  is the source of all the examples and this topic” 

 The Physical Unit method of allocation joint costing is used for separable products and cost is based on the weight allocated to each portion of the production. The formula for the Physical Unit method is as follows: For explaining this method we have many examples but the example which I am going to give there that is from the Oil sector. The Oil rigging is a process to produce the oil which a natural resource but during the producing process there are many other by products which we abstract from this process the oil companies use the same resources but with the different production costs which are actually joint costs with each other. That example helps us to understand these methods. “ Gleim’s   book 15 th edition for the CMA-USA students and Professionals  is the source of all the examples and this topic” 

 Joint Product Costing is techniques in which there are two or more products are produced with a common manufacturing process from a common process of input, which output from that manufacturing process, are known as joint products. The costs which incurred over this complete manufacturing is known as joint or common costs because the process output is in the shape of two or more than two products. But there is a point how we know that how much cost we need to spend over these separate products? At the Split-Off point where the products are being separate from the manufacturing process at these points when the cost incurred these costs are called Separable costs. For explaining these all methods we have many examples but the example which I am going to give there that is from the Oil sector. The Oil rigging is a process to produce the oil which a natural resource but during the producing process there are many other joint products which we abstract from this process the

                Joint cost allocation means to allocate the cost for those products which require the same kind of raw material and part of a same manufacturing process. But at the end of the result two or more than two final products we have form this manufacturing activity.  Each product require the almost same material but the cost allocations to them is different during the manufacturing activities.                 There are many different methods the product based  organizations using in their manufacturing processes. The mostly known are Physical unit method in which each portion allocates the costs as per the activity weight. Sales- Value at Split-Off method in which the cost allocations to the  activities over the sales of the products. The other two methods are estimated net realizable value method, and Constant gross-margin percentage NRV method in which a set or same percentage of margin issued to products and subtract the separable costs to arrive at the joint