Validity Consumer Physical Activity Monitor -Myassignmenthelp.Com

Question: Discuss About The Validity Consumer Physical Activity Monitor? Answer: Introduction The suitability of the Time Driven Activity Based Costing has been aimed to be evaluated and examined in this particular study. The essentialities of the study have been looked at from the viewpoint of a graduate consultant who has been readily employed in a management consultancy firm. For the purpose of the study, it has been assumed that the organization named Boral Limited is an important client of the consultancy firm. Boral is one of the top manufacturing firms of the nation. The first segment of the report stresses the business activities that are essentially carried out by the leading manufacturing firm. The next part of the study executes the scrutiny of the Time Driven Activity Based Costing and its essential characteristics. Lastly, the differences between the three different systems of costing namely activity based costing system, traditional systems of costing and Time Driven Activity Based Costing has been discussed. Furthermore, it has been analyzed whether the Time Dr iven Activity Based Costing is suitable for implementation in Boral Limited (Rasouli and Timmermans 2014). An insight into Boral Limited Boral Limited is a leading manufacturing firm and is essentially a multinational company. The company is based out of Australia and has its branches in USA and Asia as well. The entity primarily deals in the construction and manufacturing materials. The financial year of 2017 marked the organization generating sales revenue of 4.39 billon AUD with a number of employees ranging around 16,000 and more than 700 operating sites. There are three operating divisions in Boral, which include Boral Australia, USG Boral and Boral North America. The management of Boral Limited in considering the implementation of the TDABC system in the organization and that is the reason this organization has been chosen for this study. The main products of the organization include concrete, quarry, asphalt. Cement, concrete placing, bricks, roofing, masonry, softwood and hardwood timber. This particular division of the organization deals in and is a major supplier of the products or materials that are required for the purpose of construction that may be residential or commercial in nature along with engineering markets and roads (Hill caes et al., 2016). Time Driven Activity Based Costing system its characteristics The sole purpose of the development of the Time Driven Activity Based Costing system is that there a number of issues associated with the activity based costing system. The existence of these issues has resulted in a cheaper, more convenient and clarified costing system that is the TDABC system. The major benefit provided by this particular system of costing is that it removes the need to conduct a survey or interview the staff of the organization for the apportionment of the costs related to resources to the associated activities prior to the formulation of the cost objects. The cost objects may be orders, customers or products (Weygandt, Kimmel and Kieso 2015). The TDABC system facilitates the essential apportionment of the costs related to the resources to the cost objects. This is fundamentally executed with the help of a framework that is of optimum quality. The major characteristics of the TDABC system are as follows: The TDABC system is utilized in the computation of the cost in regards to the supply of resource capacity. To understand this in a better way, the operation of a particular department of Boral Limited can be considered. The department that handles customers has been taken into account. In carrying out the costing system of such a department, the TDABC system will compute the costs that are related to supervision, resource staff, departmental equipment and technology implemented. The system facilitates the disintegration of the total cost by the capacity of time available from the staff, executing the departmental proceedings in order to reach the cost capacity rate (Weygandt, Kimmel and Kieso 2015). The TDABC system facilitates the optimum utilization of the cost capacity rate in order to convert the resource costs in regards to the particular department by the projection of the demand of the resource capacity that is needed for all cost objects. In regards to the customer-handling department in Boral Limited, the TDABC costing system essentially needs a measurement of time that is required for the order by a particular customer, to be processed. However, it should be noted here the Time Driven Activity Based Costing system has been designed in such a way that it is not required to match each order of the customers. The uniqueness of this particular costing system lies in the fact that it permits the estimated time for each order to vary depending on the demands by the customers. These orders may be manual or automated orders, expedited orders, global orders, orders for fragile products and orders of the new customers not having any existing credit record. Thus, the TDABC system leads to the effective simulation of the processes that are employed for the execution of various works in an organization. The TDABC system also has enough capability to capture the complicated costs in comparison to the activity based costing system. The system can achieve this without the facilitation of the required data estimates and processing or storage capacities (Weygandt, Kimmel and Kieso 2015). Comparison between the traditional system of costing, ABC costing and TDABC The founder of the ABC and TDABC systems of costing has been Robert Kaplan who had developed these systems in the year of 1980. Many experts believe that the traditional system of costing has not been able to divide the overhead related to the costs in an effective manner and has failed to identify the potential band of profitable customers. This is the major reason behind the introduction of the TDABC and ABC systems of costing. It should be noted here that both the ABC and TDABC have the capacity to identify and measure the customer profitability. Thus, both these costing systems lead to the effective development of reliable cost drivers for allocating the costs to the particular activities. A comparative study of the three systems of costing has been drawn below: Traditional System of Costing A huge number of firms are using the traditional system of costing in the recent times for the allocation of manufacturing overheads to the total units that have been produced. The most essential assumption taken in by the users of the traditional costing system is that the volume of production is the major cost driver related to the manufacturing overhead. In this particular system of costing the cost accountants, carry out the allocation of the costs of manufacturing only in the case of the products. The traditional system of costing does take into account, the non-manufacturing expenses that have been incurred while producing the similar product. Moreover, it should be noted here that the conventional systems of costing is no more used by the manufacturing firms. This is due to the fact that the manufacturing firms have been using the latest technology like the computers and automated machines that outdate this particular system of costing. The traditional costing system also igno res the cost drivers that the total cost of production constitutes. Therefore, the utilization of this particular system by the manufacturing firms may lead to a faulty cost management system as this particular system does not consider the non-manufacturing costs (Christopher 2016). ABC system of costing The activity based costing system gives a perfect overview into the cost structure of a particular organization. However, it should be noted here that the companies all over the world use this particular system as a supplement. The activity based costing system facilitates the computation of cost related to the activities that are associated with the production of a particular item by linking them with an activity cost. The major advantage provided by the activity based costing system is that this particular system of costing facilitates the allocation of cost to only those products that are essentially required for production. The system results in the removal or elimination of the irrelevant costs. This particular costing system also facilitates the better extraction and interpretation related to management within the organization and better understanding of the process of costing by the non-consideration of the irrelevant costs. However, the particular disadvantage posed by this technique is that this costing system is expensive in nature and cannot be afforded by small-scale organizations (Balakrishnan, Labro and Soderstrom 2014). TDABC Costing system The TDABC system has been introduced as a further development of the Activity based costing system. The benefits provided by the TDABC system are as follows: The TDABC system has the capacity to work in association with customer relationship management and enterprise resource planning The TDABC system has the capacity to deal with a humongous number of transactions at a high processing speed by the effective utilization of the ERP system The major benefit provided by this particular system of costing is that it removes the need to conduct a survey or interview the staff of the organization for the apportionment of the costs related to resources to the associated activities prior to the formulation of the cost objects This particular system of costing provides an overview into the time capacity of business Lastly, the TDABC system can be utilized without the availability of a suitable ERP system within the organization Appropriateness of the TDABC system to Boral Limited The above analysis that has been carried out effectively indicates that the TDABC system is appropriate for Boral Limited. The major reason behind this recommendation is that this particular system of costing provides a better overview into the efficiency and the capability of the company in terms of predicting the future resource demands. Moreover, this particular firm has been facing high degree of competition from its competitor firms. Thus, it is high time that the organization considers the need to cut down its cost of production, which can only be achieved, with the help of TDABC system. This is because this particular system of costing will enable the organization to reduce the costs of production by identifying the resources that are both relevant and irrelevant in relation to the products or services of the firm. It should also be noted here that the facilities provided by the Time Driven Activity Based Costing System in regards to online services have been commendable. The administration of Boral Limited can consider creating a market online that will efficiently reduce the costs of production and also eliminate the limitations imposed by the physical or geographical boundaries. The TDABC model could facilitate the development of a suitable cost driver in regards to the cost incurred while providing services online. Moreover, the TDABC costing system provides an effective overview into the overhead costs that could be effectively utilized for monitoring and evaluating the different activities that are undertaken in order to carry out the online services of the firm. The TDABC system irrespective of the nature of business conducted by the firm will result in a number of benefits that will ultimately increase the profitability of the firm. Thus, the TDABC system is effective and appropriate fo r Boral Limited as it will provide the organizations with a number of advantages like expand the potential band of customers, minimization of costs and improve the online services by the organization. Conclusion From the discussion in the preceding paragraphs it can be concluded that the TDABC system enhances the complete costing system of a firm by removing the need to conduct a survey or interview the staff of the organization for the apportionment of the costs related to resources to the associated activities prior to the formulation of the cost objects. This particular costing system facilitates the reduction in the total cost of production by increasing the capability of the firm to estimate future resource demands. Thus, it can be evidently concluded that the TDABC system is the most appropriate costing system for Boral Limited. References Balakrishnan, R., Labro, E. and Soderstrom, N.S., 2014. 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