This module consists of an interactive exercise which encourages students to explore alternative designs for a job cost system. After studying the current cost system of a company, students will simulate alternative approaches and monitor the effects on costs and profits. The case is based around four exercises: 1) cost behavior and the classification of costs, 2) job cost systems, 3) tracing of additional costs, and 4) alternative allocation bases. Through a series of questions (with feedback), students are encouraged to explore tracing different costs and allocation bases to make comparisons on the validity of different job cost systems.
Type of Material:
Drill and practice; case study.
In class to demonstrate cost behavior, interactively, or to assign to students to review as homework.
Identify Major Learning Goals:
To identify the impact of overhead allocation on individual job profits.
To understand the trade-off in cost versus benefit for different approaches to treating costs as well as the allocation of indirect overhead costs.
Target Student Population:
Introductory management accounting or any other course where job costing is part of the curriculum.
Prerequisite Knowledge or Skills:
Basic understanding of the principles of cost accounting including: direct and indirect costs, overhead, fixed vs. variable vs. mixed costs.
Evaluation and Observation
Very high quality. Feedback is thorough and provided where appropriate. Explanation of terms and concepts is thorough. Questions are excellent. Great progression and linkage in coverage of material. Key points are outstanding. Great use of visuals in terms of bar and pie charts.
Definitions of some of the terms should be presented earlier in the learning object, for instance, direct and indirect costs.
Potential Effectiveness as a Teaching Tool
The learning objectives are identified at the home page.
Excellent the way the program pushes the viewers along the modules and insists that they address the easier material before moving to the next level.
Contains all of the elements to illustrate the concepts. Decisions from one screen carried forward to another screen. The unfolding of the modules demonstrates how the prior concepts impact subsequent decisions. Instantaneous feedback, both in terms of the numbers and the visuals on the impact of changes to parameters.
Introduction could be a bit more detailed.
Ease of Use for Both Students and Faculty
Outstanding in terms of all the criteria for evaluating ease of use. Great graphics, lots of interactivity, exceptional visual appeal.
The fact that the pictures of the bar charts change with the different assumptions is a very positive feature for visual learners. This feature enhances what can be difficult for people to otherwise visualize. In addition, being able to use the computer to see the immediate change in the charts is an advantage compared to looking at static charts in a textbook.
When one presses “back” in the module, it does not clear the prior screen. If individuals do not want the solutions to be shown, they must re-enter the module entirely to have this situation occur.
Other Issues and Comments:
Viewers should realize that the case gets more difficult as it progresses. Concepts should be mastered before proceeding. This mastery is necessary to see how earlier decisions regarding the different cost allocation bases impact the results that in turn can lead to profitability.