Financial and Managerial Accounting Analytical Essay by Nicky

Financial and Managerial Accounting
An in-depth examination of the activity-based costing (ABC) accounting method.
# 128220 | 3,013 words | 12 sources | APA | 2010 | US
Published on Jul 06, 2010 in Accounting (Financial) , Accounting (Managerial) , Accounting (Theory)

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The paper discusses how activity-based costing (ABC) is often used as a means to apportion overheads, and looks at its differences relative to other, more traditional, accounting systems. The paper then shows how the ABC supports the manufacturer in making more informed decisions, helps to control resource allocation, and evaluates the costs of not producing an item. The paper reveals that while most academicians have understood the importance of the modern and more efficient control systems, economic entities have yet to successfully implement them. The paper looks at Vicxo Software as an example of a company that has stopped using an inefficient accounting system but is now struggling to implement an internal control system.

ABC and Traditional Methods of Tackling Overhead Apportionment
ABC, Decision Making and Process Control
Systems of Control within Organizations
Objectives of the System of Control

From the Paper:

"The past century has been tormented by multiple modifications, affecting all features of the every day life. In the corporate sector, issues such as globalization and market liberalization have led to an internationalization of the run operations. And in order to cope with the emergent features and requirements, multinationals have also been striving to develop and implement more efficient and effective accounting systems. These new systems had to allow better communication, increased chances for corporate profits, and most importantly, cost reductions. In addition, they are also aimed to reduce the times of product development and ensure a more efficient management of the incurred risks."

Sample of Sources Used:

  • Barnat, R., 2005, Strategic Control: A New Perspective, Strategic Control, last accessed on October 21, 2008
  • Chellasamy, P., Ligy, V.K., 2008, Activity Based Costing - A Tool for Decision Making, Fibre 2 Fashion, last accessed on October 21, 2008
  • Cooper, R., Kaplan, R.S., 1998, Design of Cost Management Systems, 2nd Edition, Prentice Hall
  • Drucker, P.F., 2006, Classic Drucker, Harvard Business School Press
  • Dunn, P.E., 2003, Case Study: Activity Based Costing, Accounting Web, last accessed on October 21, 2008

Cite this Analytical Essay:

APA Format

Financial and Managerial Accounting (2010, July 06) Retrieved January 24, 2021, from

MLA Format

"Financial and Managerial Accounting" 06 July 2010. Web. 24 January. 2021. <>