Transnational Cablecom produces several types of communications cable. Since the manufacturing process is continuous, the company uses
Question:
Transnational Cablecom produces several types of communications cable. Since the manufacturing process is continuous, the company uses a process costing system to develop product costs. Until recently, costs were accumulated monthly and revised product costs were made available to management by the tenth of the following month. Because the company has installed a computer-integrated manufacturing (CIM) system, cost information is now available as soon as each production run is finished. The production superintendent has asked the controller to change the accounting system so that product unit costs are available the day after a production run ends.
Prepare a memorandum to the corporate vice president justifying the proposed change in the accounting system. Identify reasons that the controller can use to support the production superintendent’s request. What benefits would be obtained from the proposed modification?
Step by Step Answer:
Managerial Accounting
ISBN: 978-0618777181
8th Edition
Authors: Susan V. Crosson, Belverd E. Needles