ACC $202$ Module Three Assignment Guidelines and Rubric

Overview

Companies choose their costing method based on their business activities and processes, as well as the products and services they offer. A

company can be a manufacturing, merchandising, or service organization; this also impacts which costing method will be most useful for its

purposes. As a part of costing, the company also needs to decide how to classify overhead costs using either traditional or activity$-$based

costing $($ABC$).$

In this written assignment, you will choose a company, consider its business and costing requirements, and recommend a costing system that

will work best for the business.

Prompt

Think about a company you know. This could be a current or past employer or a company you admire. Consider its business activities and the

type of products and services offered. Based on what you have learned so far, write a short paper that reflects on the different costing

methods and speculates on how they might apply to your selected company.

Specifically, you must address the following rubric criteria:

Company Overview: Identify the company you selected and provide a brief overview of its business.

Is it a manufacturing, merchandising, or service organization?

Costing Methods: Compare the job order and process costing methods, and explain how each of these can be applied to the company.

How could the costs differ if one method is chosen over the other?

Factory Overhead: Outline possible indirect or overhead costs the company may need to account for, and identify the type of costing the

company might use for these costs.

If the company decides to use activity$-$based costing $($ABC$),$ what are some activity bases $($cost drivers$)$ it might use to allocate these

costs?

Recommendation: Based on your analysis, recommend a costing method for the company, and explain why you think this method will work

best for the business.