Acct 301 &311 db2 replies
You are required to post 1 thread of at least 500 words, and you must post 1 reply of at least 250 words. For each thread, you must support your assertions with at least 2 citations other than the textbook, and the Bible may be 1 of those sources. Everything must be in current APA format.Outside research for the replies is encouraged but not required. All research must include an in-text citation to give credit to the source of the information.
Submit each thread by 11:59 p.m. (ET) on Thursday of the assigned module/week, and submit your reply by 11:59 p.m. (ET) on Monday of the same module/week.
Job order costing is a pricing system that assigns each product that is being manufactured a specific price. This system, though effective, can be difficult to understand because people are not completely familiar with the manufacturing process (Greenberg & Schneider, 2010, p. 1). Challenges arise when a business is making products that have a variety of expenses which requires a job cost record for each individual item. However, if someone is able to become familiar with job order costing they can utilize its system to accurately record the direct materials, direct labor, and overhead that was applied to each manufacturing process. Distinct characteristics of job order costing include that each job that is simultaneously being worked on will have its own production requirements, the cost applied to each job is only applicable to that job, and the unit costs are computed by job on the job cost sheet(Garrison, Noreen & Brewer, 2018, p. 155).
Comparable to job order costing, process costing is also a common method to determine product expenses by the unit. This accounting methodology has costs that are assigned to products also but it is typically assigned to a large number of products. Process costing is another popular choice among organizations because they are able to keep a record of their money and how it is being distributed in different manufacturing processes. This system is more common in industries that constantly change raw materials into finished products; some examples are Kellogg’s, General Mills, ExxonMobil, and Coppertone (Garrison, Noreen & Brewer, 2018, p. 155). Regardless of what business decides to use process costings there is a list of features that are only available to them while using the process costing system. The three features that are utilized by process costing and not job order costings are, “A single product is produced either on a continuous basis or for long periods of time. All units of product are identical. Costs are accumulated by department. Unit costs are computed by department” (Garrison, Noreen & Brewer, 2018, p. 155).
Even though each one of these systems is selective and specific, they share some similarities. First off each system is meant to keep track of the costs that a business accumulates during a job. Next, both use similar accounts to record expenses and keep track of where the products are in the manufacturing process. Lastly, the movement of the expenses throughout the manufacturing accounts is essentially the same (Garrison, Noreen & Brewer, 2018, p. 155).
Regardless of which system businesses want their accountants to use they need to make sure they maintain ethical and biblical standards. Companies are becoming more aware of the social responsibilities and avoiding unethical actions. Not only are accountants being upheld by ethical standards but they are also called to be accurate in their numbers by God. “You must have accurate and honest weights and measures, so that you may live long in the land the Lord your God is giving you. For the Lord your God detests anyone who does these things, anyone who deals dishonestly” (Deuteronomy 25:15-16). The Bible tells us that God wants us to be honest in all things, no matter what we are measuring or doing.
Crossway Bibles. (2001). NIV: The UltraThin Edition: New International Version. Wheaton, Illinois.
Greenberg, R. K. & Schneider, A. (2010). Job Order Costing: A Simulation and Vehicle for Conceptual Discussion. Academy of Educational Leadership Journal. 14(3). https://search.proquest.com/docview/747986244?pq-origsite=summon&accountid=12085.
Garrison, R. H., Noreen, E. W. & Brewer, P. C. (2018). Managerial Accounting. McGraw-Hill Education: New York, NY.
For this collaborative discussion board, the instructor will place you into a group at the beginning of the course. You will create a thread in response to the provided prompt for each forum. Each thread must be at least 500 words and demonstrate course-related knowledge. You must support your assertions with at least 2 citations other than the textbooks; the Bible may be 1 of those sources. The composition must be attached as a word document within a new thread of the forum. Put the chapter and case in the subject line of your thread, as in “Chapter 1 Case 1-1.” In addition to the thread, the student will reply to the thread of at least 1 classmate. The reply must be at least 250 words. Citations for the replies are not required, but are encouraged. Everything must be in current APA format.
Note: Due to constant updates and revisions, you must always consult the most current style guide in completing citations and formatting. The sample provided is the work of a student and must not be used as an official sample.
Reading the article “How are earnings managed? Examples from auditors” by Nelson, Elliot, and Tarpley, one learns that there are diverse ways that managers can manage their earnings but they also come with problems. When managing money some people make errors on purpose to make sure they get the most benefit out of the situation. Whether that be more money, less taxes it all depends. Four questions were asked about the article such as: the four most common abuses, which of the abuses pertains to the percentage-of-completion, if the abuses cause net income to increase, and if the auditors make their clients adjust the abuses back to normal (Intermediate Accounting). The questions asked pertaining to the article are answered below.
Question one asks what are the four most common abuses identified and explain them. The first revenue recognition abuse stated in the article was called “cut-off manipulation”. Cut-off manipulation is when the person changes the date that the revenue was received on. This can mean that they either moved it forward or backwards in time. They do this to cause the accounting periods to change. The second abuse stated in the article involved deferring either too much or too little revenue. Deferred revenue is a payment from a customer for services or product that has not been performed or shipped yet. The third abuse stated was recognizing revenue before the sale was final. For example, a “bill and hold”(Nelson) item is recognized as revenue before it is delivered because they bill the customer and hold the item for the customer. Another example would be a Pre-Order. However, no revenue is recognized until the goods are delivered or services rendered. The fourth type of abuse involves the time in which a realized and unrealized gain on investments is recognized and confusing revenue and nonrevenue accounts.
The second question addresses which revenue recognition abuse identified relates to the percentage-of-completion method. This would be the Second abuse: deferring either too much or too little revenue of the duration of a contract. This is because the Poc method pertains to revenue recognition for a long-term contract. While the deferring too much or too little revenue of a contract connects to the long-term contract needed for the PoC method.
Question three asks if the abuses tent to increase or decrease net income in the year they occurred and they answer is yes, the revenue-recognition abuses tended to increase net income in the year that they occurred. 53% of the abuses increase net income, 31% decreased the net income, and 16% had no major effect on the income (Nelson).
Question 4 asked if the auditors tend to require their clients to make adjustments that reduced the revenue-recognition abuses they detected. Yes, the auditors required their clients to make adjustments that reduced the abuses they detected to ensure that they are managing correctly.
Nelson, M. W., Elliott, J. A., & Tarpley, R. L. (2003). How are earnings managed? examples from auditors. Accounting Horizons, 17, 17. Retrieved from http://ezproxy.liberty.edu/login?url=https://search-proquest-com.ezproxy.liberty.edu/docview/208894361?accountid=12085
OVERVIEW OF DEFERRED REVENUE . (n.d.). 1861 Wiehle Avenue, Suite 125, Reston, VA 20190 .
Spiceland, J. D., Sepe, J. F., Nelson, M., & Thomas, W. (2017). Intermediate accounting. Dubuque: McGraw-Hill Education.