I’m working on a management discussion question and need an explanation to help me study.
Write a reply minimum of 150 words for each discussion1 and discussion 2
Discussion 1 In this discussion, I will have a look at coca cola company, which is a known and very established company for over many decades and made its mark across the globe. The Coca-Cola Company is built for long-term success. The company has endured challenging historical moments before by remaining grounded in its values.
A sustainability report is an archive distributed by an organization about the every day exercises attempted by it having the monetary, natural, and social effect.
The report presents the qualities and the administration model of the organization and builds up the connection between the corporate technique and its responsibilities towards a feasible worldwide economy.
Coca-Cola gives a maintainability report. Three of the measurements recorded by the organization incorporate reused materials utilized as a level of absolute pressing materials utilized, percent of water effectiveness improved, and number of low-calorie refreshments created to advance sound living.
The organization’s supportability motto is “our duty to having a constructive outcome on the planet”. In 2019, we contributed nearly $125 million ($88 million from The Coca-Cola Foundation and $37 million from The Coca-Cola Company) to directly benefit 294 organizations across 129 countries and territories. Diversity and inclusion are at the heart of the company’s values and continue to play an important part in the company’s success.
It suggests that it is attempting to separate itself from its rivals by giving the greatest social advantage. In this way, the organization presumably thinks its benefits are driven by its social and natural effect (if its clients feel it does beneficial things, they will purchase from them).
I agree with this statement that managers in a manufacturing company can manipulate income and bury fixed production costs in ending inventory when using absorption costing. To start with, absorption costing is a costing system that ensures to value inventory in the company (Act, 2021). This includes the cost of resource materials used in production and the cost of labor invested in the production process. Again, absorption costing ensures to include overhead costs in the production process. There are both the variable and fixed overhead costs of the company.
I strongly believe that managers in a manufacturing company can take advantage of absorption costing to influence the income and bury fixed production. This is based on the components of absorption costing, which also implies full costing of the production process. This includes the cost of the product as it incorporates direct material used in the manufacturing process (Devi, Irasari, & Sudibyo, 2020). Also, direct labor in the production process helps to calculate the cost of production and hence the possible profit margins. Again, absorption costing includes variable manufacturing overhead and fixed manufacturing overhead. All the above factors are essential in ensuring fixed production in the company. Also, full costing ensures consideration of variable selling and administrative as one of the period costs. Fixed selling and administrative costs that do not reflect in the product cost. This implies the costs are incurred during the process of production and in the period of manufacturing.
Act, C. E. (2021). “Absorption costing” model, 209–210 “Activity based costing” model, 209–210, 213 Analytical indicators, 87 Annual growth rate, 60–61. indicators, 98.
Devi, M. I., Irasari, P., & Sudibyo, H. (2020, November). Domestic Component Level of Absorption and Variable Costing Method for Interior Permanent Magnet Motor Cost. In 2020 International Conference on Sustainable Energy Engineering and Application (ICSEEA) (pp. 1-5). IEEE.