Job costing is relevant for manufacturing goods and provision of services. Give a short descriptive example of job costing in the manufacture of goods and another example for the provision of services. The keeping of individual job records is useful in so many ways but name the two main overarching value of job costing for future jobs.

TTM Sdn Bhd has two major clients which they advise on strategy. One is a large profit- making company and the other, a small not for profit agency. The fee that TTM charges is based on cost plus a margin. In deciding how to allocate its overhead to its clients, TTM decides to use the base that allocates the higher amount to the profit-making company as the company would be better able to bear the charges. Advise whether this is ethical and support your answer with appropriate reasons for your decision. Advise a possible basis for allocation to the profit making company.

From the details in the case study, as a business analyst, prepare a report in the form of a memo to your manager, using the rubric provided. Incorporate the answers to the three criteria (a), (b) and (c) as well as (d) and (e) below on the two service operations:

1. Traceability of costs and revenues
2. Allocation base of overheads
3. Decision on pricing and product mix

From the analysis of (a), (b) and (c) above on the two service companies, advise for each of the two companies:

4. The necessity of stock valuation
5. Costing method

Answer rating: 100% (QA)

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