ma ass2 nguyen thuy linh.docx

8/16/2019 MA Ass2 NGUYEN THUY LINH.docx

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Qualification Unit Code / Unit number and title

Pearson BTEC Level 5 HND Diploma in Business(Management)

R/6!/"#6

$nit % Management &''ounting Costing anBugeting

Student name / BTEC Registration Number Assessor name

*+ Ho,ng &n-

Ngu.n Tu0n &n-L1 P-23ng Mai

Ngu.n T-an- Ng4'

Trn T- *7

869!!

8:9;8"9


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to reducecosts anden"ance

*alue)it"in abusiness

;;$se per@orman'e ini'ators toienti@. potentialimprovements

#

;#=uggest improvements toreu'e 'ostsF en-an'e valuean ualit.

#

Student declaration

A 'erti@. t-at t-e orG su>mitte @or t-is assignment is m. on A -ave 'learl. re@eren'e an. sour'esuse in t-e orG A unerstan t-at @alse e'laration is a @orm o@ malpra'ti'e

=tuent signature Date

RESENTAT('N

! T-e assignment s-oul -ave a 'over page t-at in'lues t-e assignmenttitleF assignment num>erF 'ourse titleF moule titleF Le'turer/tutor namean stuents name &tta'- all t-e pages o@ assignment >rie@/a'-ievementsummar. it- .our report an leave t-em >lanG @or o@@i'ial use

; Ensure t-at aut-enti'it. e'laration -as >een signe

# T-is is an iniviual assignment

ers

5 & @ull. t.pe up pro@essionall. presente report o'ument $se !; point&rial or Times Ne Roman s'ript

6 Iour assignment s-oul >e or9pro'esse an s-oul not eJ'ee ;F5

ors in lengt-

: $se t-e Harvar re@eren'ing s.stem

" EJ-i>its/appeni'es are outsie t-is limit

% T-e assignment s-oul 'ontain a list o@ an. re@eren'es use in t-e report

N'TES T' STU$ENTS 1'R SUMM(SS('N

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• C-e'G 'are@ull. t-e su>mission ate an t-e instru'tions given it- t-eassignment Late assignments ill not >e a''epte

• Ensure t-at .ou give .oursel@ enoug- time to 'omplete t-e assignment >.t-e ue ate

• Do not leave t-ings su'- as printing to t-e last minute K eJ'uses o@ t-isnature ill not >e a''epte @or @ailure to -an9in t-e orG on time

• Iou must taGe responsi>ilit. @or managing .our on time e@@e'tivel.

• A@ .ou are una>le to -an in .our assignment on time an -ave valireasons su'- as illnessF .ou ma. appl. (in riting) @or an eJtension

• 8ailure to a'-ieve a P&== grae ill results in a RE8ERR&L grae >einggiven

• TaGe great 'are t-at i@ .ou use ot-er peoples orG or ieas in .ourassignmentF .ou properl. re@eren'e t-em in .our teJt an an.

>i>liograp-.• N'TE, (f you are caug"t +lagiari2ing3 t"e Uni*ersity +olicies and

+rocedures )ill a++ly.

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Ac"ie*ement Summary

QualificationPearson BTEC Level 5 HNDDiploma in Business(Management)

Assessorname

Unit Numberand title

$nit % Management &''ountingCosting an >ugeting Student name

CriteriaReference

To ac"ie*e t"e criteria t"e e*idence must s"o) t"att"e student is able to,

Ac"ie*ed4

tic-0&' 5

!! Classi@. i@@erent t.pes o@ 'ost

!; $se i@@erent 'osting met-os

!# Cal'ulate 'osts using appropriate te'-niues

!< &nal.se 'ost ata using appropriate te'-niues

&' 6

;! Prepare an anal.se routine 'ost reports

;; $se per@orman'e ini'ators to ienti@. potential improvements

;# =uggest improvements to reu'e 'ostsF en-an'e value an ualit.

%ig"er 7rade ac"ie*ements )"ere a++licable0

7rade descri+torAc"ie*ed

4tic-0

7rade descri+torAc"ie*ed

4tic-0

M! Aenti@. an appl. strategiesto @in appropriate solutions

D! $se 'riti'alre@le'tion to evaluateon orG an [email protected] 'on'lusions

M; =ele't/esign an appl.appropriate met-os/te'-niues

D; TaGe responsi>ilit.@or managing anorganising a'tivities

M# Present an 'ommuni'ateappropriate @inings

D# Demonstrate'onvergent / lateral /'reative t-inGing

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Assignment 1eedbac-

1ormati*e 1eedbac-, Assessor to Student

Action lan

Summati*e feedbac-

1eedbac-, Student to Assessor

Assessor Signature $ate

Student Signature $ate

FOR INTERNAL USE ONLY

VERIFIED YES € NO €

DATE : .................................................................

VERIFIED BY : .................................................................

NAME : .................................................................

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EXECUTIVE SUMMARY

Management accounting provides accurate statistic and timely information which help

people to make suitable decision in business. By applying different costing systems

and costing methods, this report will concentrate on analysing three main problems of

Kim Dong Publishing House in controlling cost for the company. n addition, we will

give out some solutions to reduce costs, improve !uality and appropriate costing

methods for a better business performance.

"his report which related to Kim Dong will focus on three main chapters#

$hapter %# $lassify different types of cost

$hapter 'se different costing methods

$hapter (# Prepare and analyse routine cost reports

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TABLE OF CONTENT

)*)$'"+) 'MM-/..................................................................................0

1" 23 "-B1) -4D 35').....................................................................6. 4"2D'$"24..........................................................................................7

. B2D/........................................................................................................%8

%.% $lassify different types of cost...............................................................%8

%.%.%# Definitions about different types of cost#...........................................%8

%.%. $lassification different types of cost in Kim Dong $ompany#..........%&

%.& 'se different costing methods................................................................%(

%.( $alculate costs using appropriate techni!ues.........................................%0

-. "raditional cost method..........................................................................%0

B. -ctivity 9 Based $osting#......................................................................%:

$. $omment on our findings#.....................................................................%6

%.; < &.% -nalysis of costs data and routine costs reports...........................%7

-. -nalysis of cost data..............................................................................%7

B. outine costs reports#.............................................................................&&

&.& 'se performance indicators to identify potential improvements...........&(

&.&.% "he idle tine ratio.............................................................................&(

&.&.& Material wastage= loss......................................................................&;

&.&.( Machine breakdown.........................................................................&>

&.( uggest improvements to reduce costs, enhance value and !uality.......&0

&.(.%. educe cost#.......................................................................................&0

&.(.&. ?uality enhancement..........................................................................&0

&.(.(. +alue...................................................................................................&6

. $24$1'24.........................................................................................&7

+. )P))4$)..........................................................................................(8

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LIST OF TABLES AND FIGURE"able %# Different type of cost............................................................................%&

"able Direct Materials....................................................................................%(

"able (# Prime cost.............................................................................................%(

"able ;# $onversion $ost....................................................................................%(

"able ># $ost of 5oods Manufactured................................................................%;

"able 0# $ost of 5oods old...............................................................................%;

"able :# ncome tatement.................................................................................%>

"able 6# "raditional $ost....................................................................................%0"able 7# -ctivity @ Based $osting.......................................................................%:

"able %8# -ctivity $ost.......................................................................................%:

"able %%# 2verhead $osts...................................................................................%6

"able % outine costs reports...........................................................................&&

I

3igure %# -bsorption $osting Method................................................................%73igure -ctivity@Based $osting.......................................................................&8

3igure (# "he changes in profits between -$ and -B$ method........................&%

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I. INTRODUCTION

"he writer are newly appointed -ssistant Management -ccounting )Aecutive for Kim

Dong tasked to compile a report related to manufacturing costing system of a new product

in +ietnam. "he report includes the following main obectives#

C $lassify different types of cost

C 'se different costing methods

C $alculate costs using appropriate techni!ues

C -nalyse cost data using appropriate techni!ues

C Prepare and analyse routine cost reports

C 'se performance indicators to identify potential improvements

C uggest improvements to reduce costs, enhance value and !uality

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II. BODY

1.1Classify differe! !y"es #f $#s!

1.1.1% Defii!i#s a'! differe! !y"es #f $#s!%C#s!% sacrificed resource to achieve a specific obective BPP, p.;E

A$$#rdi( !# &e)a*i#'r $#s!%

• Varia&le $#s!% a cost which varies with the level of activity BPP, p.%%E• Fi+ed $#s!% a cost which is incurred for a particular period of time and which,

within certain activity level, is unaffected by changes in the level of activity

BPP, p.%%E• Mi+ed $#s!% a cost which contains both fiAed and variable components and so

is partly affected by changes in the level of activity BPP, p.%(E

• S!e" $#s!s% is a cost which is fiAed in nature but only within certain level

BPP, p.%(E

A$$#rdi( !# ide!ifia&ili!y%

•

Dire$! $#s!% a cost that can be traced in full to the product, service, or department that is being costed. BPP, p.0E

o Dire$! ,a!erials% all material becoming part of the producto Dire$! la'r $#s!s% the specific costs of the workforce used to make

product or provide a service.o Dire$! e+"eses% any eApenses are incurred on a specific product

other than direct material cost and direct wages. BPP, p.:E

• Idire$! $#s!- O*er)ead% a cost that is incurred in the course of making a

product, providing a service or running a department, but which cannot be

traced directly and in full to the product, service or department. BPP, p.:E

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A$$#rdi( !# !i,e ad "eri#d%

• r#d'$!s $#s!% are costs identified with a finished product. uch costs are

initially identified as part of the value of stock. "hey become eApenses only

when the stock is sold BPP, p.%8E

• eri#d $#s!% costs that are deducted as eApenses during the current period

without ever being included in the value of stock held. BPP, p.%8E

A$$#rdi( !# ,aa(erial de$isi#s%

• O""#r!'i!y $#s!% is the profit lost when one alternative is selected over

another. "he concept is useful simply as a reminder to eAamine all reasonable

alternatives before making a decision accountingtools, &8%(E.• S'/ $#s!% is a cost that an entity has incurred, and which it can no longer

recover by any means accountingtools, &8%(E

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1.1.0% Classifi$a!i# differe! !y"es #f $#s! i i, D#( C#,"ay%

"he table below will illustrate the cost that the Kim Dong has applied to the company#

C#s! i!e,s Varia&le$#s!

Fi+ed$#s!

r#d'$! $#s! eri#d$#s!2S3A4

O""#r!'i!y$#s! S'/ $#s!Dire$!,a!erial

Dire$!la'r

Ma'fa$!'ri( #*er)ead

Directmaterialspapers, inkE

Directmanufacturinglabor

Plant suppliesused

Property taAeson plant

Plant utilities

ndirectmanufacturing

labor

Depreciation@ plant ande!uipment

Miscellaneousmanufacturingoverhead

Marketing,distribution,and customer@service costs

Ta&le 1% Differe! !y"e #f $#s!

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1.0Use differe! $#s!i( ,e!)#ds

Direct materials used

2pening direct material 08

Direct materials purchased %08

$losing direct material %8E

Dire$! ,a!erial 'sed 015

Ta&le 0% Dire$! Ma!erials

Prime cost (Direct material + direct labour)

Direct material used &%8

Direct labor 68

ri,e $#s! 065

Ta&le 7% ri,e $#s!

Conversion cost (Direct labour + Manufacturing Overheads)

Direct 1abour 68

Plant supplies used %&

Property taAes on plant &

Plant utilities %8

ndirect manufacturing labour ;8

Depreciation@plant and e!uipment %6

Miscellaneous manufacturing overhead &8

C#*ersi# $#s! 180

Ta&le 9% C#*ersi# C#s!

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Schedule of cost of goods manufactured

Direct material used &%8

Direct 1abor 68

Plant supplies used %&

Property taAes on plant &

Plant utilities %8

ndirect manufacturing labor ;8

Depreciation@plant and e!uipment %6

Miscellaneous manufacturing overhead &8

2pening work in process &8

$losing work in process ;E

C#s! #f (##ds ,a'fa$!'red 958

Ta&le :% C#s! #f G##ds Ma'fa$!'red

C#s! #f (##ds ,a'fa$!'red ; &e(ii(


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$ost of goods manufactured ;86

$losing 3inished 5oods &;E

C#s! #f (##ds s#ld 99

Ta&le % C#s! #f G##ds S#ld

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Income Statement

IM HNG UBLISING OUSE

I$#,e S!a!e,e!

F#r 0519

evenue :88

$ost of goods sold ;0;E

5ross margin &(0

Marketing, distribution, and customer@service

costs

%68E

2perating income >0

Ta&le J% I$#,e S!a!e,e!

S'""#se !)a! i, D#( ,a'fa$!'re 7 ,illi# 'i!s #f "r#d'$!%

Direct material used F210,000,000

3,000,000 F G:8 per unit

Depreciation on plant and e!uipment F18,000,000

3,000,000 F G0 per unit

Ass',i( !)a! !)e $#s!s are &ei( "redi$!ed f#r !)e ,a'fa$!'re #f 9 ,illi# 'i!s #f

"r#d'$!%

Direct material unit cost will still be G:8 per unit. "otal direct materials cost will increase to

G&68,888,888 G:8 per unit A ;,888,888E

"otal depreciation will still be G%6,888,888.

Depreciation cost per unit F18,000,000

4,000,000 F G;.> per unit

Direct materials cost is variable cost, so materials cost per unit will be the same while total

direct materials costs will change as output levels change. Depreciation on plant and

e!uipment is fiAed cost so whether output levels changes, the total depreciation cost will be

the same. But when output levels increase, depreciation per unit will decrease.

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1.7Cal$'la!e $#s!s 'si( a""r#"ria!e !e$)i'es

A. Tradi!i#al $#s! ,e!)#d

-

G Per unit

B

G Per unit

Paper;88g G& per kgE 8.6 8.%

Printing ink >8ml G(8 per

litre

%.> ;.>

Machine costs 0 mins

G%& per hoursE

%.& &

2verheads 0 mins G&;

per hoursE

&.; ;

"otal cost >.7 %8.0

elling price 7.( %;

Margin (.; (.;

Ta&le 8% Tradi!i#al C#s!

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B. A$!i*i!y > Based C#s!i(%

A$!i*i!y C#s!

"##lC#s! Dri*er

O*er)ead C#s!

f#r A$!i*i!y

Ui!s #f

A$!i*i!y

Ra!e

-Di*er $#s!

Property $osts Property &,%08,888 %&8,888 G%6=hour

?uality control $ontrol 006,888 &88 G(,(;8=control

Production set

up costset up >&,888 %0 G(,&>8=et@up

Ra!e ; O*er)ead $#s! f#r A$!i*i!y K Ui!s #f A$!i*i!y

Ta&le 6% A$!i*i!y @ Based C#s!i(

#< !# $al$'la!e 'i!s #f a$!i*i!y i "r#"er!y $#s!s%

IMachine hour F6

60 J %,888,888

10

60 J %&8,888

F %88,888 &8,888

F %&8,888 hoursE

ate G=hour F 2,160,000120,000

F %6 G=hour

-ctivity cost

poolate

Product - Product B

-ctual 'nits

of -ctivity

$ost

-llocated to

product

-ctual 'nits

of -ctivity

$ost

-llocated to

product

Property costs G%6=hour %88,888 G%,688,888 &8,888 G(08,888

?uality

control G(,(;8=control %68 G08%,&88 &8 G00,688Production set

up costsG(,&>8=et@up ; G%(,888 %& G(7,888

"otal

2verheadG&,;%;,&88 G;0>,688

C#s! All#$a!ed !# "r#d'$! ; A$!'al Ui!s #f A$!i*i!y Ra!e

Ta&le 15% A$!i*i!y C#s!

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2verhead $osts -ssigned to Products#

Product -# &,;%;,&88 L %,888,888 F G&.;%;&='nit

Product B# ;0>,688 L %&8,888 F G(.66%0='nit

Product - G='nit Product B G='nit

Paper;88g G& per kgE 8.6 8.%Printing ink >8ml G(8 per

litre%.> ;.>

Machine costs 0 mins

G%& per hoursE%.& &

Manufacturing 2verhead &.;%;& (.66%0

T#!al :.6190 15.981elling price 7.( %;

Mar(i 7.78:8 7.:189

Ta&le 11% O*er)ead C#s!s

C. C#,,e! # #'r fidi(s%

2verall, the different methods will obtain different results. Profits per unit of product - and

product B are a clear distinction. Moreover, total costs per unit are also distinction.

3irstly, according to traditional method absorption costingE both the products show profits

with the same number which is G(.;=unit. Besides, the results from -ctivity9Based $osting

-B$E method show that product - is not beneficial with a lower number which is

G(.(6>6=unit. t means that according to traditional method product - will decrease. n

contrast, product B creates higher profit that is G(.>%6;=unit. t also means that according to

activity@based costing method product B will increase

ith the results of this study, Kim Dong Publishing House will wrongly assess the profit of

the each product if they use the traditional method. "herefore, management should use to the

-ctivity9Based $osting -B$E method in order to make a good decision. Because of some

following reason#

the -ctivity9Based $osting -B$E method are more detailed measures of cost, better

understanding of activities, benefits should always be compared to costs of implementation

,etc..

However, everything has & facesN -ctivity@Based $osting -B$E too waste of time, costs and

operational resources for employees because this method need calculate each activities of

product.

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1.93 0.1 Aalysis #f $#s!s da!a ad r#'!ie $#s!s re"#r!s

A. Aalysis #f $#s! da!a-ccording to outcome %.(, there is an analysis of the cost data from Kim Dong Publishing

House. ith traditional method and -ctivity9Based $osting method

A&s#r"!i# C#s!i( Me!)#d%

Paper; 14%

Printing ink; 25%

Machine costs; 20%

Overheads; 41%

Product A

Paper Printing ink

Machine costs Overheads

Paper; 1%

Printing ink; 58%Machine costs; 26%

Overheads; 15%

Produc B

Paper Printing ink


Fi('re 1% A&s#r"!i# C#s!i( Me!)#d

Both pies chart show that 2verheads and Machine costs are main parts in both

products. Printing ink in product - is &>O, while printing ink in product B is >6O. Besides,

paper, which is materials ust have %;O in product - and %O in product B.

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A$!i*i!y>Based C#s!i( ,e!)#d%

Paper; 1%

Printing ink; 25%

Machine costs; 20%

Overheads; 42%

Product A

Paper Printing ink


Paper; 1%

Printing ink; 48%

Machine costs; 21%

Overheads; 0%

Product B

Paper Printing ink


Fi('re 0% A$!i*i!y@Based C#s!i(

Both pies chart show that 2verheads and Machine costs are main parts in both

products. Printing ink in product - is &>O, while printing ink in product B is ;6O. Besides,

paper, which is materials ust have %(O in product - and %O in product B.

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"he changes in profits between & methods are shown#

n addition the study would want to contribute is the changes in profits between & methods

are shown for Product - and Product B using the & different methods. Based on -bsorption

$osting method and -ctivity @ Based $osting are shown#

Product A Product B0

0!5

1

1!5

2

2!5

!5

4

4!5

5

!4 !4!" !52

Pro#t per unit

A$sorption %osting

Activit& ' Based %osting

Product A Product B0

2

4

6

8

10

12

5!"

10!6

5!"1

10!48

(ota) %ost Per *nit

A$sorption %osting

Activit&'Based %osting

Fi('re 7% T)e $)a(es i "r#fi!s &e!


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use -B$ method in order to find out KimDong need to invest more on product B to achieve

more and more profits.

B. R#'!ie $#s!s re"#r!s%

A&s#r"!i# C#s!i( A$!i*i!y>Based C#s!i(

Product-

million G

ProductB

million G

Product-

million G

ProductB

million G

Re*e'e 7.( %; Re*e'e 7.( %;

R#'!ie C#s!s% R#'!ie C#s!s%

Paper 8.6 8.8% Paper 8.6 8.8%

Printing ink %.> ;.> Printing ink %.> ;.>

Machine costs %.& & Machine costs %.& &

2verheads &.; ; 2verheads#

9 Property costs &.;%;& (.66%0

9 ?uality control 8.08%& 8.8006

9 Production set upcosts

8.8%( 8.8(7

T#!al :.6 1.0J0 T#!al .:089 15.96J9

Mar(i 7.9 7.9 Mar(i 7.78:8 7.:189

Ta&le 10% R#'!ie $#s!s re"#r!s

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"he costs that the Kim Dong Publishing House used in a fiscal year have been recorded and

analysed fully through the table based on -$ and -B$E above. -s can be seen, many things

have been eAposed#

Product B brings greater revenue when comparing to Product - G%;million to

G7.(millionE.

"hree main things of the outine $osts are the same between -bsorption $osting

method and -ctivity9Based $osting method PaperN Printing inkN Machine costsE.

n 2verheads, -B$ method has presented much more details, which listed the (

specific parts Property costsN ?uality controlN Production set up costsE.

"he "otal outine $osts of Product - increases G8.0&6;million switching from -$ to-B$ from G>.7million to G0.>&6;millionE while Product BQs also increases with the

much bigger number from G%.&:&million in -$ to G%8.;7:;million in -B$E.

"he Margins )Apected ProfitsE of Product - and Product B in -$ are e!ual

G(.;millionE. Meanwhile, the margin of Product B is higher than Product -s

G(.(6>6million compared to G(.>%6;millionE

ith the analysis of the outine $osts report, both products perform !uite well when using

-bsorption $osting method, but when changing to -ctivity9Based $osting method, product

B seems to reveal many shortcomings. ith much less units produced %&8,888 units

compared to Product -Qs number is %,888,888E and creating too great costs, the mangers

should reconsider the production of Product B.

0.0Use "erf#r,a$e idi$a!#rs !# ide!ify "#!e!ial i,"r#*e,e!s

0.0.1 T)e idle !ie ra!i#"he idle time ratio is useful because it shows the proportion of available hours which were

lost as a result of idle time. BPP, &8%(E

F#r,'la%

Idle !i,e ra!i# ; Idle hours

Total hours+ 155

Ca'ses%

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Production causes mean machine breakdown, lack of material or tools, power failure waiting

for work because of non@scheduling of work properly etc.

Normal Idle time: wastage of time in normal routine function in due course of

production and which is unavoidable is treated as normal idle. Abnormal idle time:

dle time due to productive and administrative causes stated above is treated as abnormal idle

time. "his idle time is generally beyond control, but it can be reduced or avoided if sufficient

care is taken. 3or this purpose there must be a proper coordination between management and

workers.

S#l'!i#%

@ "reatment of normal idle time and abnormal idle time is different. "he cost of normal

idle time can be adusted in total cost of production or it can be treated as a factory

overheads. "he cost of abnormal idle time should not be absorbed in total cost of

production but it should be charged to the costing profit and loss account.

@ "abulation comparable idle time ratio with other companies, if dle time ratio is

higher than idle time standard of the competitor, we will show the workflow

inefficiencies. "herefore, companies should tabulate rate idle time periodically to

improve the working of the company.

0.0.0 Ma!erial


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@ educing the competitiveness of the commodity# the !uality of raw materials is

reduced, this directly affects the !uality of the finished product.

@ $an cause lack of raw materials in the production process due not to maAimum the

entire material leads to reduced labor productivity.

S#l'!i#%

@ 'sing of high technology can take the maAimum of raw material in the manufacturing

process to avoid material wastage.

@ 3ocusing on material preserved by the construction of dedicated warehouses containing

materials.

@ )stablish strict management system each stage of production, enhance personal

responsibility.

@ et the fire protection system, security system setting Burglar.

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0.7S'((es! i,"r#*e,e!s !# red'$e $#s!s e)a$e *al'e ad 'ali!y

0.7.1. Red'$e $#s!%

Ma!erial $#s!%@ 3ind another supplier# Kim Dong can look for another supplier if their material is

cheaper

@ Buy in large !uantities paper, ink, pin, glue, etc.E# By buying materials in large

!uantities, Kim Dong $ompany can take advantage of discounts. But the !uality of

products still has to fulfil the minimum re!uirements otherwise customers will not be

satisfied

@ Decrease the paper siRe and font siRe# "his is an idea of saving paper, glue and ink. t

will still remain the same content inside the book but it will help Kim Dong to save

more.

La'r $#s!%

@ mprove employeeQs productivity# "he company has to train employees so that they

can work better and more efficiency.

@ Boost up the productivity over one hour# for eAample, if one hour, employees can

make %8 books, now if Kim Dong raises the re!uired products into %& instead of %8,

they can receive more books at the same time still the salary unchanged.

O*er)ead%

@ Maintenance, use new modern machines# "his can help to reduce maintenance cost on

machines. Kim Dong can buy new and good condition machines, printers which help

the manufacturing process more !uickly.

0.7.0. 'ali!y e)a$e,e!

f product has good !uality, customers will be willing to purchase, although its price can be

much higher than real price. ?uality of product or service is also defined as Sfitness for the

customerQs purposeT BPP, &8%8E. "here are four main degrees that fit product=service for its

purpose, including cost, life, manner of production, and esteem BPP, &8%8E.

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C#s! ad life% 'sually eApect for the products to last base on their price. f the product is

eApensive, they will eApect them to be used in long@term as a high !uality product. However,

if the product is cheap, customer do not eApect them to be used in long time.

Maer #f "r#d'$!i#% productQs !uality can be affected by the laboursQ skill or the materialcost.

Es!ee,% a famous label and well design package are usually the two factors that customer

look for a product.

?uality will be the main core to determine a product. "he cost to achieve to the best

!uality is not small. "here are ; main kind of cost that a company has to spend to get the

!uality of their product. "he two first ones are about good !uality, and the rest is about bad

!uality#

@ re*e!i# $#s!# tQs the cost that the companies will have to spend to prevent their

business from failure. "he prevention cost can be# the cost of getting !uality

employees, statistical process control and !uality management tools

@ A""raisal $#s!% the term refers to inspection costs, which eAamines the !uality of the

product before deliver to customer. "he cost include of the salary of the inspector,

costs related to maintaining, testing e!uipment and material, etc.

@ I!eral fail're $#s!% the cost of failing to meet target !uality. "he costs include the

losses by selling products at lower price than normal

@ E+!eral fail're $#s!% tQs also the cost of failing to meet target !uality. "he cost

related to the outside of company which are customers, investors, suppliers, etc.

S'((es!i# !# i,"r#*e 'ali!y% f Kim DongQs products are in good !uality, even they are athigh price, and customers will not be hesitating to buy them. Based on that, there are two

ways for Kim Dong $ompany to improve its !uality as follow#

@ U" Uust in timeE ystem# to minus the cost, Kim Dong can re!uire supplier to deliver

materials in time instead of being kept in warehouse. By doing this, it will help papers

to being moist or mould. -s soon as materials are needed, material will be distributed

to production department. By doing this, Kim Dong will save money and avoid

wasting materials.

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@ "?M "otal ?uality ManagementE Programmes# is Sis an approach that seeks to

improve !uality and performance which will meet or eAceed customer eApectationsT

logistics, &8%(E. "o improve and control !uality, this one will be the most helpful

way for Kim Dong $ompany. t will control the process of manufacturing, printing to

avoid errors as much as the company can handle. n addition, it will help to increase

productQs !uality, reduce cost of waste.

0.7.7. Val'e

a. ri$i"les #f *al'e

+alue is considered productQs fitness for purpose and the prestige or esteem attached BPP,&8%8E. Based on that, the value of a product is classified into four aspects#

$ost value# the cost of producing and selling an item. n Kim Dong, cost value is the cost of

raw materials such as paper, glue, ink, etc.

)Achange value# the market value of product. Price of the book depends on each kinds of

book from (8,888 to &88,888 +4D.

'se value# is what the product does, the purpose of it fulfil. "he purpose of producing is for

education for children, help them to have basic knowledge.

)steem value# Kim Dong is one the biggest publisher in +ietnam. "his publisher will ensure

not only the design but also the content of the book

&. S'((es!i#s f#r e)a$i( *al'e%

@ Make some adustment in the design, covering page of book

@ mprove the content of the book

@ Promotion activities# make plan to promote the book, establish some events, set up

senior about the important of reading book, etc.

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III. CONCLUSION

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IV. REERENCES

a$$#'!i(!##ls hat is a sunk costV W2nlineX. @ Uuly (%, &8%(. @

http#==www.accountingtools.com=!uestions@and@answers=what@is@a@[email protected].

a$$#'!i(!##ls hat is opportunity costV W2nlineX. @ -rpil %;, &8%(. @

http#==www.accountingtools.com=!uestions@and@answers=what@is@[email protected].

I*es!#r#rds W2nlineX. @ &8%>. @ http#==www.investorwords.com=%%;6=cost.html.

l#(is!i$s "otal ?uality Management "?ME W2nlineX. @ &8%(. @

http#==logistics.about.com=od=!ualityinthesupplychain=a="?M.htm.

ma ass2 nguyen thuy linh.docx

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