Learning Journal 4 - BUS 3301

docx

School

University of the People *

*We aren’t endorsed by this school

Course

3301

Subject

Business

Date

Nov 24, 2024

Type

docx

Pages

Uploaded by fakos4

Learning Journal 4 – BUS 3301- University of the People From primary school what most people know, talking of business activities in relation with the money involved is the cost price. But in managerial accounting, the so-called cost price we were taught in our lower education is now split into several costs to help the business manager have a better understanding of how the company expenses are going in relationship with its production. In this assignment, I will talk about Celeste , the mineral company I talked about already in one of my previous assignments, in categorizing the main type of costs it faces in the course of its bottled mineral water production in the Ivory Coast. Celeste as a company faces mainly two types of costs: variable costs and fixed costs (Walther, 2012, Chap. 18 . Celeste variable costs are formed of the costs of all direct materials that constitute the water that is pumped from underground and the bottles that contain this water. It is then these two materials that put together constitute the final offer of the company to its customers. The amount of water used in the creation of the mineral water offer increases if the company production increases but decrease if the production decreases. The same for the number of bottles used. With high production, Celeste uses more bottles to pack the water, but with low production, this number drops. To these first costs comes Celeste's direct labor formed of all those who work directly to make the product effective. Their number increases and decreases as well, depending on if the company is in a high production time or not. For, in high demand period, the company recruits extra direct workers that will be mostly released after three or six months. However, as I said already, Celeste has also fixed costs to deal with. These costs are from the administration expenses, indirect labor (I mean other employees that are not directly involved in the production activities, but still contribute to the company’s well-doing), plants and equipment depreciation, rent, and property taxes, for example. These costs do not change, no matter how high or low the company’s production is. Maybe it is also good to be precise that the precited fixed costs can be sub-categorized as committed fixed costs in opposite to discretional fixed costs like what it costs to a company to make its employees be trained for better company productivity. Thus, in the context of company production, managers mainly deal with two categories of cost generally. Variable costs, and fixed costs. If the former is not stable but increases or decreases with the company's production increase and decrease, the latter does not change at all. For, as they are named, they are fixed and should be paid anyway, with no regard to the production increase or decrease.

References Walther, L. M. (2012). Principles of accounting . Utah State University. https://www.principlesofaccounting.com/chapter-18/cost-behavior/ Fixe costs Variable costs Step costs Committed fixed costs Discretional fixed costs Cost structure implication

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

Related Documents

BSBOPS601 Student Assessment Guide.docx

Screenshot 2023-11-11 at 12.45.55 PM.png

xqw.pdf

Assessment 6 (page 7 of 11).pdf

BSBLDR523 Assessment Templates V1.0821.docx

Rework-G130925+V1-Disney.docx

CW2P2 (1).docx

A11_AUTOMATIZADA.docx

Management and Managing comp 3 (8).docx

BSBTEC403 - A2 V02_301023.docx

WK2 DQ.docx

BSBTWK503 Task 1.pdf

Recommended textbooks for you

Practical Management Science

Operations Management

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:Cengage,

Purchasing and Supply Chain Management

Operations Management

ISBN:9781285869681

Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:Cengage Learning

Foundations of Business (MindTap Course List)

Marketing

ISBN:9781337386920

Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor

Publisher:Cengage Learning

Foundations of Business - Standalone book (MindTa...

Marketing

ISBN:9781285193946

Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor

Publisher:Cengage Learning

SEE MORE TEXTBOOKS

Recommended textbooks for you

Practical Management Science
Operations Management
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:Cengage,
Purchasing and Supply Chain Management
Operations Management
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Cengage Learning
Foundations of Business (MindTap Course List)
Marketing
ISBN:9781337386920
Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Publisher:Cengage Learning
Foundations of Business - Standalone book (MindTa...
Marketing
ISBN:9781285193946
Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Publisher:Cengage Learning