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Part 1: In this unit we explore the different types of costs that companies incur and how those costs behave

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Part 1: In this unit we explore the different types of costs that companies incur and how those costs behave. The types of costs are categorized as direct, indirect, and overhead costs. The way these costs behave determines if they are fixed, variable, or a combination of both (“mixed”). Once the type and behavior are identified, the costs can be analyzed on a per-unit basis. This is needed because we can see the total costs for a period of time by reviewing the financial statements of a business; however, in order to control costs, managers must understand those costs at the unit level. Using the knowledge acquired from this unit, respond to the discussion task that follows:

• Select a public (i.e., publishes its financial statements) manufacturing company and become familiar with its products. Describe the company, its products, and the specific manufacturing costs it incurs. Categorize each cost into the three manufacturing cost categories and state if the costs are variable, fixed, or mixed. Explain how you came to your conclusions.

• Your Discussion should be a minimum of 250 words in length and no more than 450 words. Please include a word count. Following the APA standard, use references and in-text citations from the textbook and any other sources. 

Note: if you do not have work experience, you may select a company with which you are familiar with and apply the discussion assignment to it.

Part 2:

Submit a paper which is 2-3 pages in length, exclusive of the reference page. The paper should be double spaced in Times New Roman (or its equivalent) font, which is no greater than 12 points in size. The paper should cite at least three sources in APA format.

In this paper, please discuss the three costing methods of job order costing, process costing, and activity-based costing. 

• Define each method and explain when it is best suited to be used. 
• Compare and contrast the methods and consider their benefits and shortfalls. 
• Use the information provided to propose which cost method should be used to allocate costs.

Wet Suit World is a company that manufactures wet suits for use with water sports such as snorkeling and scuba diving. The suits are made in sizes small through 3x extra large with levels of insulation layers of 2 millimeters, 5 millimeters, and 7 millimeters. They come in black with the Wet Suit World logo imprinted across the chest. The materials are the same for all of the suits, though they vary in thickness. All suits undergo the same production and quality inspection processes.

There is no one “correct” answer to the proposed cost allocation method as long as the answer is well-supported based on the week’s learning.

Superior papers will include the following when responding to the assignment question:

• Define the three costing methods.
• Explain when each is most appropriately used.
• Compare and contrast the methods, considering both benefits and shortfalls.
• Provide a well-supported proposal for the cost method Wet Suit World should use.

Be sure to use APA formatting in your paper.  Purdue University’s Online Writing LAB (OWL) is a free website that provides excellent information and resources for understanding and using the APA format and style. The OWL website can be accessed here: http://owl.english.purdue.edu/owl/resource/560/01/

Part 3:

This week we focused on manufacturing costs, but selling, general, and administrative (SG&A) costs are also important. Using the company, you selected for the discussion forum question, what specific types of SG&A costs would the company incur? How would these costs be considered in product costing?

As portfolio activities are to be self-reflective, please make sure to connect the portfolio assignment to:

• Your personal experiences. Reflect on how this assignment topic is applicable to and will benefit you.
• Course readings and any external readings.
• Discussion forum posts or course objectives.

The Portfolio Activity entry should be a minimum of 500 words and not more than 750 words. Use APA citations and references if you use ideas from the readings or other sources.