Saturday, June 7, 2008

kaizen costing

Q:-Define kaizen costing ?

Ans :-Kaizen costing is combination of two words kaizen and costing . Kaizzen here means continous improvement . This is Japanese word . So kaizen costing is a system in which we try to reduce cost when we are in production stage . In kaizen costing we can taken following steps to reduce cost
More motivation employees
To minimize the waste
to improve the efficiency of machine

Q:- Define activity based costing (ABC) give its procedure
Ans Activity based costing is that method costing in which we calculate total cost on basis of different activities .
Steps taken in Abc
1.Identification of main activities
First of all we identify all activities of our production and sale department
Ist Activity To run machine
2nd Activity To produce finished product
3rd activity To sale the finished product
2. Identify the main cost drive :-
Cost driver may be no of units , no. of hours , no. of workers .
Creation of cost center

Cost center may be machine man or place who is responsible for cost .

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