1 Cost Accounting ACCT301 Student’s Name Institutional Affiliation Course Code Instructor’s Name Submission Date 2 Cost Accounting ACCT301 Question 1 Different firms use different techniques in evaluating their activities. Job costing systems are used to account for costs by those companies that yield separate and unique output. These companies determine their overhead allocation rates by dividing their estimated overheads by a suitable allocation base (ElMaraghy & Alami, 2020). Two examples of Saudi companies that employ job costing systems are Bahri and Olayan Group (ElMaraghy & Alami, 2020). Bahri is a shipping firm with its headquarters in Saudi Arabia. The firm primarily engages in the logistics and transportation sector. Thus, establishing itself as a logistic leader in Saudi Arabia. Bahri management has installed the job costing system in its operations. Therefore, each shipping journey would be accounted for as a separate job. Besides, Olayan Group is primarily a private organization based in Saudi Arabia with strategic branches in other nations. The company is a holding company with a subsidiary that deals in construction work. Each construction project would ideally be accounted for as a separate job. In this way, the costs incurred on a particular construction project would be accumulated and charged under it. Job costing systems maintain separate accounts for each product or the particular job (ElMaraghy & Alami, 2020). All costs incurred under a particular job or product are specifically charged to it. Overhead costs are also allocated to the jobs as is appropriate using the predetermined overhead rates. Question 2 Activities are established by analyzing the tasks needed to complete a particular product or job (Zamrud, Abu, Kamil, & Safeiee, 2019). Overheads are then estimated and assigned to these activities. To determine the overhead rates, the cost drivers for these activities are also 3 established. The overhead rates for these activities are then calculated by dividing the overheads by the estimated quantity of an activity's cost driver (Drobyazko, Pavlova, Suhak, & Khodjimukhamedova, 2019). Overheads are allocated to jobs using these predetermined overhead rates by multiplying these rates by the amount of the cost driver employed by a given product or job. Taking the case of an activity with total overheads of $20,000, which are to be allocated based on 4,000 machine hours, the predetermined overhead rate would be $5 per machine hour (Zamrud et al., 2019). A product or job that would use 1.5 machine hours would be apportioned overheads of $7.50 under the system. The allocation of overheads to products and jobs using Activity-Based Costing is important as this reflects a more true cost. In this way, prices of products can be set depending on the value added to the product. However, ActivityBased Costing requires investment in advanced technology to accurately track the costs of the business. Hence, implementing this system tends to be costly for businesses, especially the small firms (Zamrud et al., 2019). Small business ventures that installed the Activity Bases Costing often end up spending more resources in production. Thus, they are forced to hike their prices to recover the costs. 4 References Drobyazko, S., Pavlova, H., Suhak, T., Kulyk, V., & Khodjimukhamedova, S. (2019). Formation of hybrid costing system accounting model at the enterprise. ElMaraghy, W., & Alami, D. (2020). Activity-Based Aggregate Job Costing Model for Reconfigurable Manufacturing Systems. International Journal of Industry and Sustainable Development, 1(2), 1-19. Zamrud, N. F., Abu, M. Y., Kamil, N. N. N. M., & Safeiee, F. L. M. (2019, August). A comparative study of product costing uses activity-based costing (ABC) and time-driven activity-based costing (TDABC) methods. In Proceedings of the International Manufacturing Engineering Conference & The Asia Pacific Conference on Manufacturing Systems (pp. 171-178). Springer, Singapore. Critical Thinking Read the Management Focus on, “NAFTA’s Tomato Wars,” available in your e-book (page no. 620), and answer the following questions: Assignment Question(s): (Marks: 5) 1. Do you think that Mexican producers were dumping tomatoes in the United States? Discuss. (mark:1) 2. Was the Commerce Department right to establish a new minimum floor price rather than scrap the agreement and file an antidumping suit? Who would have benefited from an antidumping suit against Mexican tomato producers? Who would have suffered? (marks:3) 3. What do you think is the optimal government policy response here? Explain your answer. (mark:1) Answer: 
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