Business Finance

Question Description

I don’t understand this Accounting question and need help to study.


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Final Answer

After reviewing the production videos on the Hershey’s website, it seems likely the company would use process costing versus job costing techniques to track the costs associated with producing the various chocolate bars. Both techniques will identify  the costs associated with producing the candy bars, the difference is the process costing technique allocates the total cost of production across all units of output. his usually entails accumulation of costs for each stage !or department" of production and assigning those costs to all output from that stage.!#alther,$%&$" ' feel that the process technique best matches the production process Hersheyutili(es)ven on their website videos, Hershey breaks the production of the candy bars intoseven separate functions, each with the end goal of developing the finest chocolate bars possible but with unique and separate processes.*ust as Hershey has multiple processes, they will also have multiple product costs. A fewtraceable product costs that come to mind are associated with the seven website videos. he firstfilm shows the production of the raw cocoa beans. he company will costs associated with the purchase of raw materials such as the beans, sugar, and milk. his cost would be variable costs,as the production is increased, the volume of raw materials would also increase. he second stage of roasting and breaking the beans may also have variable inventory costs, and possibly acombination fuel costs to heat the roasters. Hershey will always have the fuel costs, but the amounts will vary depending on the amount of beans being roasted. he third stage of milling and pressing the beans will also have a combination of fuel cost to run the machinery. he blending and mi+ing of the chocolate looks to have a lot of direct labor and once again fuel costs to run mi+ers, heaters and dryers in addition to the various employees creating direct labor costs.he refining process runs many heavy granite rollers and mi+ers to develop the chocolate into a smooth te+ture and will also generate additional fuel and power costs. inally, the wrapping and packaging stages will have variable costs for the materials to wrap and package the candy in preparation for transportation to the consumer

Robert__F (46183)
Carnegie Mellon University

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