Costing techniques applicable in advanced manufacturing enterprises: activity based costing, Japanese cost management techniques, life cycle costing, theory of constraints, cost of quality, economic value added, and financial versus operational performance measures. Emphasis will be placed on linkages to such advanced manufacturing systems as cellular manufacturing, flexible manufacturing, JIT, Lean and ERP.
The student, upon completion of this course, will be able to:
- Explain and distinguish relevant costing terminology in the context of advanced manufacturing. Examples include (but are not limited to) direct cost, indirect cost, cost assignment, cost allocation, cost driver, opportunity cost, and sunk cost
- Explain and distinguish the cost estimation methods high-low and regression analysis.
- Explain the approach followed in activity based costing (ABC) and time-driven ABC and compare them to traditional volume-based costing systems
- Explain the philosophy followed in Japanese cost management techniques (JCMT) and describe how market price, desired profit, and value engineering are used to determine and achieve the target cost.
- Explain the impact of costs of quality in the long term profitability of an organization.
- Demonstrate the ability to communicate and document technical information in a professional, structured, timely, and effective manner.