“ACCT320-1202A-01 Intermediate Accounting II

Assignment Name: Unit 1 Individual Project

Deliverable Length: 1-2 sentences per question Details:

Your company, a medium-sized manufacturer of widgets, has just held the annual end of year “”State of
the Business”” meeting for all employees. The president discussed how
well the company has been doing, focusing on presenting the Income Statement
for the last year. During the meeting, he used terms like product
costs, and period costs, and how each affects the
company’s profits. He also announced that going forward, instead of
manufacturing just one standard type of widgets, there will be a new
department added that will make custom versions of the firm’s normal product
line.
At the end of the meeting, he asks
each supervisor to prepare a memo to his or her own employees,
describing in layman’s terms the following concepts:

What
are the differences between product and period costs?
Why
is it important to properly distinguish one type of cost from the other?
Where
on the firm’s income statement will period costs usually show up?
Where
on the firm’s income statement would product costs end up?
The
new department will make use of a job order costing system. How and why
will this differ from the current process costing system used elsewhere
in the plant?
Provide
2 examples of companies that would use:

job
order costing
process
costing
explain
your answers

Sample Income Statement

+

Sales

–

COGS

=

Gross profit or gross margin

–

Selling, General,
Administrative expenses

=

Net income

Grading Guidelines

30%

What
are the differences between product and period costs?
Why
is it important to properly distinguish one type of cost from the other?

10%

Where
on the firm’s income statement will period costs usually show up?
Where
on the firm’s income statement would product costs end up?

30%

The
new department will make use of a job order costing system. How and why
will this differ from the current process costing system used elsewhere
in the plant?

30%

Provide 2 examples of companies that
would use:

job
order costing
process
costing
explain
your answers

Objective:

Identify the major differences and
similarities between financial and managerial accounting and distinguish
between product costs, period costs, process costing, job-order costing and
identify companies that would use each costing method.

ACCT320-1202A-01 Intermediate
Accounting IIAssignment Name:Unit 1 Individual ProjectDeliverable Length:1-2 sentences per questionDetails:Your company, a medium-sized
manufacturer of widgets, has just held the annual end of year “”State of
the Business”” meeting for all employees. The president discussed how
well the company has been doing, focusing on presenting the Income Statement
for the last year. During the meeting, he used terms like product
costs, and period costs, and how each affects the
company’s profits. He also announced that going forward, instead of
manufacturing just one standard type of widgets, there will be a new
department added that will make custom versions of the firm’s normal product
line.At the end of the meeting, he asks
each supervisor to prepare a memo to his or her own employees,
describing in layman’s terms the following concepts:Sample Income Statement+Sales-COGS=Gross profit or gross margin-Selling, General,
Administrative expenses=Net incomeGrading Guidelines30%10%30%30%Provide 2 examples of companies that
would use:Objective: Identify the major differences and
similarities between financial and managerial accounting and distinguish
between product costs, period costs, process costing, job-order costing and
identify companies that would use each costing method.”