Strategic Cost Management 1. Strategic management perspective - obtaining a 5.

Leadership perspective – unite the behavioursof

“gameplan” to ensure creation of value for the fellow employee who have diverse needs,
customers. beliefs and goals to the workplace. Leaders need to
Chapter 1 Introduction to Strategic Cost Management
- Categories of customer value; understand how (a) internal motivation (b) external
 Customer intimacy incentives and (c) cognitive bias influence human
Strategy is a set of policies, procedures and approaches to
 Operational Excellence behavior.
business that produce long term success while strategic
 Product Leadership
management involves the development of a sustainable
6. Ethical Perspective - actions, decisions, or
competitive position.
2. Enterprise risk management perspective – principles that align with moral values and
obtaining a process to identify risks and develop standards of right conduct.
responses to assure meeting its goals. - building trust in the integrity of the business
Cost management information is the information that the
- risks could not be eliminated, merely managed. which is vital for the economy
manager needs to effectively manage the firm, profit-
oriented as well as not-for-profit organization.
3. Corporate social responsibility perspective - is a
concept where business organizations consider the
Cost management is the practice of accounting in which needs of all stakeholders when making decisions. Management Accounting is the process of identification,
the accountant develop and uses cost management - Stakeholders maybe the customers, suppliers, measurement, accumulation, analysis, preparation,
information. stockholders, employees, communities and interpretation, and communication of financial information,
environmental or human rights advocacy. which is used by management to plan, evaluate and control
Uses of Cost Management Information
activities within an organization.
1. Strategic management 4. Process Management Perspective - priority of
Tasks of Management Accountants
2. Planning and decision making business process rather than the chain of command
3. Management and operational control from functional departments, to best serve 1. Scorekeeping and data accumulation
4. Reportorial and compliance to legal requirements customers. 2. Interpreting and reporting of information
- Business process is the series of steps followed 3. Problem-solving
Basic Cost Management Perspectives;
to carry out the tasks in a business.
Guidelines in providing the tasks;
 1. Employ a cost-benefit approach. Types of Authority; Controllership – is the practice of the established science
2. Recognize behavioral as well as technical of control which is the process by which management
1. Line authority – command and give action
considerations and assures itself that the resources are procured and utilized
(downward).
3. Use appropriate cost concepts for different purpose. according to plans to achieve the company's objectives.
2. Staff authority – advise but not command others
Administrative functions of Management Accountants; (upward). Basic Functions of Controllership

1. Planning The accounting function is usually "staff", with 1. Planning

2. Controlling responsibility for providing line managers and other staff 2. Control
3. Decision making managers, with specialized services. 3. Reporting
4. Accounting
5. Other primary responsibilities (taxes, audits,
Cost accounting is a systematic set of procedures for Chief Financial Officer (CFO) – also called the finance treasury functions etc.)
recording and reporting measurements of the cost of director in many countries - is the executive responsible for
Qualifications of the Controller
manufacturing goods and performing services in the overseeing the financial operations of an organization.
aggregate and in detail. It includes methods for 1. Excellent technical foundation in accounting and
Responsibility areas of CFO;
recognizing, classifying, allocating, aggregating and finance
reporting such costs and comparing them with standard 1. Controllership 2. Understanding of the principles of planning,
costs. 2. Treasury organizing, and control.
3. Risk Management 3. General understanding of the industry in which the
4. Taxation company competes
5. Internal Audit 4. A thorough understanding of the company,
5. The ability to communicate with all levels of

Controller – financial executive primarily responsible for management and a basic understanding of the other
Chapter 2: The Professional Environment of Cost
management accounting and financial accounting. functional problems
Management
6. The ability to express ideas clearly in writing or in
making informative presentations.
 7. The ability to motivate others. 2. to treat sensitive matters with confidentiality, responsibilities for individuals within an organization or
3. to maintain personal integrity, and group.
4. to be objective in all disclosing.
Treasurership – is concerned with the acquisition, Guidelines on Ethics for Professional Accountants
financing and management of assets of a business concern Courses of action in case of conflict;
- governs the activities of all professional accountants
to maximize the wealth of the firms for its owners.
1. Discuss such problems with the immediate superior throughout the world issued by International
except when it appears that the superior is involved. Federation of Accountants (IFAC) in July 1990
If not resolved, submit issues to higher managerial
Treasurer – has custody of cash and funds invested in Certifications available to management accountants;
level.
various marketable securities.
2. If higher level is CFO or equivalent; submit to 1. Certificate of Management Accounting (CMA)
Responsibilities of a Treasurer; reviewing authority (audit, executive, BOD, BOT, 2. Certificate in Public Accounting (CPA)

owners) 3. Certificate in Internal Auditing (CIA)

1. Funds procurement
2. Banking and Custody of Funds 3. Clarify relevant ethical issues by confidential

3. Investment of Funds discussion with an objective advisor (e.g., IMA Institute of Management Accountants (IMA) – is a
4. Operating Responsibilities Ethics Counseling Service). professional organization organized in 1919, that conducts
4. Consult your own attorney as to legal obligations the CMA examination and publishes the monthly magazine
and rights concerning the ethical conflict. Strategic Finance since 1973.
Ethical Standards for Management Accountants 5. Resign from the organization

- Institute of Management Accountants (IMA) of Possible reasons for unethical behavior;

Philippine Association of Management Accountants
the United States has developed a very useful
1. the organization expects unethical behavior, (PAMA) – was established in 1972 as the National
ethical code called the “Standards of Ethical
2. everyone else is unethical, and/or Association of Accountants (NAA)Philippine Chapter, Inc.
Conduct for Practitioners of Management
3. behaving unethically is the only way to get ahead It was founded primarily to provide its members with
Accounting and Financial Management”.
educational and professional activities that supplement in
Areas of Ethical Responsibilities the knowledge of management accounting practices and
Company Code of Conduct – is a set of guidelines and
1. to maintain a high level of professional competence, principles that outlines expected behaviors and methods.
Basic Objectives of PAMA Phases on development of Cost Management Systems; Chapter 4: Developing a Competitive Strategy;
Contemporary Management Techniques
1. To establish management accounting as a  Stage 1: Cost management systems are basic
recognized profession. transaction reporting systems.  Long term success comes from an effective
2. To foster higher educational standards in the field of  Stage 2: As they develop into the second stage, cost implementation of a well-developed strategy.
management accounting. management systems focus on external financial  A strategy starts with identifying the mission of the
3. To assist employees, educators and students by reporting. company and narrowing it down to the specific
establishing an objective measure of an individuals'  Stage 3: Cost management systems track key performance objectives.
knowledge and competence in the field of operating data and develop more accurate and
management accounting. relevant cost information for decision making
Financial Measures of Success;
 Stage 4: Strategically relevant cost management
information is an integral part of the system is 1. Sales

limited. 2. Profitability
3. Liquidity
4. Market Value
Chapter 3: Contemporary Business Environment & Critical Success Factors – are measures of the aspects of
Strategic Focus of Cost Management the firm's performance essential to its competitive
advantage and, therefore, to its success. Non-financial Measures of Success (Customer);

Cost Management – no uniform definition, though is used 1. Customer satisfaction

Changes in Business Environment;
to describe the approaches and activities of managers in 2. Marketing and selling
1. Increase in global competition 3. Timeliness of delivery
short-run and long-run planning and control decisions that
2. Advances in manufacturing technologies 4. Quality
increase value for customers and lower costs of products
3. Advances in information technologies 5. Dealer and distribution
and services.
4. Greater focus on the customer
5. New forms of management organization
6. Changes in the social, political, and cultural Internal Business Process
environment of business
 1. Quality 4. Incorrect investment decisions - with this approach, there are manufacturing costs
2. Productivity 5. Inability to effectively benchmark competitors reduced, however, idle time may rise as production
3. Flexibility 6. Failure to identify most profitable products, lines are starved for materials more frequently than
4. Equipment readiness customer and markets before.
5. Safety - Major Features of JIT Production System;
o Production is organized in manufacturing
Competitive Strategies
cells
Learning and Innovation
1. Cost Leadership o Workers are trained to be multiskilled
1. Product innovation 2. Product Differentiation
o Total quality management is aggressively
2. Timeless of new product
pursued to eliminate defects
3. Skills development
Contemporary Cost Management Techniques – tools o Emphasis is placed on reducing setup time
4. Employee morale
used by management to implement the firm's broad strategy o Suppliers are carefully selected for delivery
5. Competence
and to facilitate the achievement of success on critical of quality-tested parts in a timely manner
success factors.
Others 3. Process Reengineering – is an approach where a
1. Total Quality Management (TQM) – products are
1. Government relations of the highest quality and that production processes business process is diagrammed in detail,

are efficient. questioned and then completely redesigned in order

Characteristics; to eliminate unnecessary steps, to reduce

o a focus on serving customers, and opportunities for errors and to reduce costs.
Possible Consequences for Lack of Strategic
o systematic problem-solving using teams
Information 4. Benchmarking – is the process of (a) determining
made up of front-line
critical success factors, (b) studying the best
1. Decision making based on intuition
practices of other firms to achieve these and (3)
2. Lack of clarity about direction and goals 2. Just-in-Time (JIT) – production system in which
implement improvements in the firm's processes to
3. Lack of clear and favorable perception of the firm materials are purchased and units are produced only
match or beat the performance of those competitors
by customers and suppliers as needed to meet actual customer demand.
5. Mass Customization – is a management technique 9. Life Cycle Costing – is a management technique to Budgetary Control – use of budgets to control a firm’s
in which marketing and production processes are identify and monitor the costs of a product activities
designed to handle the increased variety that results throughout its lifecycle.
Role of a Budget
from delivering customized products
and services to customers. 10. Target Costing – determination of the desired cost 1. Allocating resources

for a product or the basis of a given competitive 2. Coordinating operations

6. Balanced Scorecard – is an accounting report that price so that the product will earn a desired Profit 3. Identifying constraints and limitations

includes the firm's critical success factors in four - TARGET COST = Market Price – 4. communicating expected actions and results

areas Desired Profit 5. motivating and guiding implementation

a) financial performance, 6. providing guidelines for control operations

b) customer satisfaction, 11. Computer-Aided Design and Manufacturing – 7. managing cash flows

c) internal business process, and use of computer-aided design (CAD) and computer- 8. serving as criteria in performance evaluation

d) innovation and learning. aided manufacturing (CAM) to respond to changing

consumer tastes more quickly. The Management Process of Preparing the Master
7. Activity-based Costing and Management – ABC Budget
is the approach identifying the activities related to
 Top Management Involvement – needs to be
costs and accurately tracing the sources of costs.
involved and show strong interest in budget results.
ABM is the analysis of the activities for improved
operational and management control
Chapter 5: Strategy and Master Budget  Organization for Budget Preparation – assign the
most qualified personnel for the preparation of the
8. Theory of Constraints (TOC) – is a sequential
budget.
process of identifying and removing constraints in
Budget – financial plan of the resources needed to carry
system.
out tasks and meet financial goals  Budget Guidelines – provide initial budget

Budgeting – act of preparing budget guidelines that set the tone for the budget and
govern budget preparation.
  The Budget Period – different type of budgets Budgeting in International Setting – subsidiaries or
should be made for different time spans. subdivisions of a multinational firm often have their own
Direct Materials, Direct Labor and Overhead Budget –
budgets.
after determining the number of units to be produced, these
 The Initial Budget Proposal – internal and
three can be prepared while considering different factors.
external factors should be considered in preparing
the initial budget proposal. Alternative Approaches Budgeting

Cost of Sales Budget – can be prepared using production  Zero Based Budgeting – budgeting process that
 Budget Negotiation, Review and Approval, budget, direct materials budget, direct labor budget and requires managers to prepare budgets from a zero
Revision – the head of the budget units checks the overhead budget. base.
budget proposal to determine whether the proposal
is within the budget guidelines  Activity-Based Budgeting - budgeting process
Marketing and Administrative Expense Budget – these based on activities and cost drivers of the operation.
are made up of fixed and marketing variable components.

The Master Budget – comprehensive budget  Kaizen Budgeting – budgeting approach that
explicitly demands continuous improvement in
for a specific period. Financial Budgets – cash Budget, Budgeted Income
operation processes
Statement, Projected Balance Flow of Statement
- also referred as profit planning or targeting
Budgeting in Service Industries – a service organization
Ethical Issue in Budgeting
achieves its budgeted goals and fulfils its mission through
Sales Budget – showing what products will be sold in what
providing services Goal Congruence – consistency between the goals of the
quantities at what prices.
firm and the goals of its employees.
Budgeting in Not-For-Profit Organization – a non-for-
profit organization's objective is to provide services Authoritative or Participative Budgeting – budgeting
Production Budget – after sales budget, a decision can be efficiently while not spending more than the allowed process are either top down or bottom up.
made on the level of production that will be needed for the expenditure level
period to support sales and the production budget.
Chapter 6: Organizational innovations: Total Quality TQM, Although Some specific projects can quickly yield  Review and revise
Management Just-in-time Production System high returns, a firm will most likely not see many tangible
benefits in the early years of implementation.
Types of Conformances

Quality – the ultimate test of a quality product or service is 1. Goalpost Conformance (zero-defects
whether the product or service meets or exceeds customers' Year One- Preparation and Planning conformance) – a specified range around the target.
expectations. - target is the ideal or desired outcome of the
 Create quality council and staff
operations
 Conduct executive-quality training programs
- zero-defects conformance with the specified
 Conduct quality audits
Total Quality Management (TQM)– according to Procter range allowed for variations.
 Prepare gap analysis (determine the gap between the
and Gamble it is the unyielding and continually improving
best in class and the firm's current practice)
effort by everyone in an organization to understand, meet 2. Absolute quality conformance (robust quality
 Develop strategy on quality improvement
and exceed the expectation of customers. approach) - requires that all products or services to

Core Principles of TQM meet target value exactly with no variation.

Year-Two- Training and Implementation

 Focus on satisfying the customer
 Strive for continuous improvement  Conduct employee communication and training Cost of Quality – the sum of conformance and

 Involve fully the entire work force program nonconformance costs

 Support and involve top management actively  Establish quality teams 1. Prevention Costs – these are costs incurred to
 Use clear and measurable objective  Create a measurement system and set goals avoid poor-quality goods or services or reduce the
 Recognize quality achievements in a timely manner number of defects in products or services.
 Provide training on TQM continuously
Year Three - Assessment, Review & Revise
The implementation of TQM is not an easy task and is 2. Appraisal Costs – these costs, also called

indeed time consuming. The Institute of Management  Revise compensation / appraisal / recognition inspection costs, are incurred to identify products

Accountants believes that a typical organization takes three systems before the products are shipped to customers.

to five years to make from traditional management to  Launch external initiative with suppliers
 3. Internal Failure Costs – these are costs that result 1. Some important quality costs are typically omitted complains, there are 10 to 20 others who have had
from identification of defects during the appraisal from the quality costs report. bad experiences with the product or service but did
process. 2. Simply measuring and reporting quality costs does not complain.
not solve quality programs. Only management 5. Number of defective units shipped to customers as a
4. External Failure Costs – these are incurred when action can solve them. percentage of total units shipped
poor-quality goods or services are detected after 3. A log may exist between when quality 6. Market research information on customer
delivery to customers. improvement programs are put into effect and when preferences and customer satisfaction with specific
the results are seen product features.

Uses of Quality Cost Information

Reporting Quality Costs Nonfinancial Measures of Internal Performance
1. Quality cost information provides a basis for
establishing budgets for quality costs as Purpose: to make management aware of the magnitude of 1. Number of defects for each product line
management looks for ways to reduce the total cost quality costs and to provide a baseline against which the 2. Employee turnover (ratio of number of employees
involved. impact of quality improvement activities could be who leave the company to the average total number
2. Quality cost information helps managers see the measured. of employees)
financial significance of quality. 3. Process yield (ratio of good output to total output)
3. Quality cost information helps managers identify
the relative importance of the quality problems Nonfinancial Measures of Customer Satisfaction

faced by the firm. Time as a Competitive Tool

1. On-time delivery rate (the percentage of shipments
4. Quality cost information helps managers see made on or before the scheduled delivery date)  Customer-response time – is the duration from the
whether their quality costs are poorly distributed 2. Delivery delays (the difference between the time a customer places an order for a product or
and when needed, it helps them distribute the costs scheduled delivery date and the date requested by service to the time the product or service is
better the customer) delivered to the customer
3. Percentage of products that fail soon or often  On-time performance- refers to situations in which

Limitations of Quality Cost Information 4. Number of customer complaints (Companies the product or service is actually delivered by the
estimate that for every customer who actually time it was scheduled to be delivered.
 o heightened emphasis on eliminating 3. Internal Business Processes – measures of the
the specific causes of rework, scrap, efficiency and effectiveness with which the firm
Just-in-time (JIT) production (also called lean
and waste, and produces the product or service
production) – is a demand-pull manufacturing system
o lower manufacturing lead times. 4. Innovation and Learning – measures of the firm's
because each component in a production line is produced as
ability to develop and utilize human resources to
soon as and only when needed by the next step in the
meet the strategic goals now and into the future.
production line

- Aim to simultaneously (1meet customer

Chapter 7: The Balanced Scorecard: A Tool to Financial performance measures summarize the results of
demand in a timely way, (2} with high-
Implement Strategy past actions and are important to a firm's owners, creditors,
quality products and (3) at the lowest
Balanced Scorecard – translates an organization’s mission employees and so forth.
possible total cost.
and strategy into a set of performance measures that
- Key Features of JIT provides the framework for implementing the strategy.
Nonfinancial performance measures concentrate on
o Maintaining a limited number of - it balances the use of financial and current activities which will be the drivers of future
suppliers nonfinancial performance measures to financial performance.
o Improving plant layout evaluate short-run and long-run performance
o Reducing Setup Time in a single report.
o Improving Production Scheduling Features of a Good Balanced Scorecard
4 Perspectives of the Balanced Scorecard
o Targeting Zero Defects 1. The balanced scorecard should tell the story of a
o Maintaining Flexible Workforce 1. Financial Perspective – measures of profitability
company’s strategy by articulating a sequence of
and market value among others, as indicators of
cause-and-effect relationships.
how well the firm satisfied its owners and
- Financial Benefits of JIT 2. It helps to communicate the strategy to all members
shareholders.
o greater transparency of the of the organization by translating the strategy into a
2. Customer Satisfaction – measures of quality service
production process, coherent and linked set to understandable and
and low cost, among others, as indicators of how
measurable operational targets.
well the firm satisfies its customers.
 3. In for-profit companies, the balanced scorecard  Analyze changes in operating income into  Manufacturing Cycle Efficiency (MCE) – through
places strong emphasis on financial objectives and components that can be identifies with growth, concerted efforts to eliminate the non-value-added
measures. product differentiation, and cost leadership. activities of inspecting, moving, and queuing, some
4. The balanced scorecard should focus only on key  Analytical relationships that can be used: companies have reduced their throughput time to
measures to be used by identifying only the most  Growth Component only a fraction of previous levels
critical ones.  Price Recovery Component  MCE = Value-Added Time / Throughout
5. The scorecard should highlight suboptimal tradeoffs  Productivity Component (manufacturing cycle) time
that managers may make when the fail to consider
operational and financial measure together.
Internal Business Process Performance

 Delivery Cycle Time – the amount of time from

Pitfalls in Implementing a Balanced Scorecard Chapter 8: Cost Management for Product Cycle: Life
when an order is received from a customer to when
Cycle Costing and Long-Term Pricing; Target Costing
1. Don’t assume the cause-and-effect linkages and the completed order is shipped
and Theory of Constraints
precise.  Throughout (Manufacturing Cycle) Time – the
2. Don’t seek improvements across all of the measures amount of time required to turn raw materials into Cost Life Cycle – is the sequence of activities within the

all of the time. completed products. firm that begins with research and development, followed

3. Don’t use only objective measures in the balanced  Inspection time – is the amount of time by design, manufacturing, marketing / distribution and

scorecard. spent ensuring that the product is not customer service

4. Don’t fail to considerr both costs and benefits of defective. - The methods helpful in analyzing the cost
initiatives.  Move time – is the time required to move life cycle are:
5. Don’t ignore nonfinancial measures when materials or partially completed products  Life-cycle costing – used throughout
evaluating managers and employees. from Workstation to workstation. the cost life cycle to minimize
6. Don't use too many measures.  Queue time – is the amount of time a overall cost
product spends waiting to be worked on, to - management technique used to
be moved, to be inspected, or to be shipped. identify and monitor the cost of
Evaluating the Success of a Strategy
product or service throughout the life  Target costing – used for managing  Theory of constraints – a method for
cycle the cost primarily in the design managing manufacturing costs
activity - steps in theory of constraints
- the critical success at the design - steps in implementing a target cost analysis
stage include: approach 1.identify the binding constraints
1. reduced time-to-market 1. determine the market price 2. determine the most efficient
2. reduced expected service costs 2. determine the desired profit utilization for each binding
3. improved ease of manufacture 3. calculate the target cost at market constraint
4. process planning and design price less desired profit 3. manage the flows through the
4. use value engineering to identify binding constraint
- common design models; ways to reduce product cost 4. add capacity to the constraint
1. basic engineering - product - value engineering is used to target 5. redesign the manufacturing
designers work independently from costing to provide product cost by process for flexibility and fast cycle
marketing and manufacturing analyzing the trade-offs between time
2. prototyping – developed and different types of products and
tested by engineers and trial functionality and total product cost.
customers - design analysis
3. templating – existing product is - cost tables computer-based Sales Life Cycle – is the sequence of phases in the

scaled up and down databases product’s or service’s life in the market from the

4. concurrent engineering Group technology method of introduction of the product or service to growth in sales and

(simultaneous engineering) – product identifying similarities in the parts of finally maturity, decline and withdrawal from the market

design is integrated with products - Phases of Sales Life Cycle

manufacturing and marketing 5. use kaizen costing and operational 1. Product Introduction
control to further reduce costs 2. Growth
3. Maturity
4. Decline
Chapter 9: Decentralized operations and Segment Advantages of Decentralization 3. Cost to gather information is increased
Reporting 4. Activities may be duplicated
 Creates greater responsiveness to local needs
Decentralization - the process of delegating the decision-  Leads to gains from quicker decision making Segment Reporting – statement of income designed to
making authority throughout an organization  Increases motivation of subunit managers focus on various segments of the company
 Aids management development and learning
Decentralized Approach – refers to a management - Has a purpose of providing information
 Sharpens the focus of subunit managers
structure where decision-making authority is distributed needed by the manager to determine
 Decisions are best made at that level in an
across various levels within the organization profitability of product lines, divisions, sales
organization where problems and opportunities arise
territories and other segments of a company
- Allows management of operations at  Management is relieved of much day-to-day
- It emphasizes performance of a profit or
detailed level by giving authority to those problem solving and is left free to concentrate on
investment center rather than the
who have necessary local knowledge long-range planning and on coordination of efforts
performance of the company as a whole
- Allows timely decision at lower levels in  Segment managers obtains more job satisfaction
-
the firm and are encouraged to put forth their best efforts by
giving them added responsibility and decision Segment – any part or activity of an organization about
Centralized Approach – refers to a management structure
making authority which manager seeks costs, revenue or profit data
where decision-making authority and control are
concentrated at the top levels of the organization  It provides excellent training to managers by giving
them greater decision-making control over their
- Give an advantage of top management Level of Segmented Statement
segments
retaining the control over key business
 Better and faster performance evaluation  Sales and Contribution Margin – particularly useful
functions, ensuring a desired level of
in determining what happens to profit as volume
performance.
changes, assuming that the segment’s capacity and
- Additionally, with the top management Limitations of Decentralization
fixed cost are constant.
involvement in most decisions, the expertise 1. Dysfunctional decision making may result to
of top management can be effectively suboptimal or incongruent decision making  Traceable and Common Fixed Costs – traceable
coordinated. 2. Managers’ attention may be focused only on the fixed costs of a segment is a fixed cost that is
subunit rather than the organization as a whole incurred as a consequence of the existence of the
 segment and could be easily identified or traced to  the use of inappropriate methods for allocating cost
the particular segments among segments of a company; and
- note: only traceable or direct fixed costs are  the assignment of costs to segments when they are
charged to the segments in the report. really common costs.
- Examples: salary of a division manager
Inappropriate Methods for Allocating Costs among
insurance and maintenance cost of the
segments
division manager
- deducting traceable fixed costs from the Cost distortion or cross-subsidization occurs when the

segment contribution margin would yield the costs are improperly assigned among the company’s

segment margin or contribution margin to segment. This can occur in two ways:

indirect or common costs 1. When the company fails to track costs directly to
segment in those situation where it is feasible to do
 Sales Margin – represents the margin available after so.
a segment has covered all of its own costs and the 2. When the company uses inappropriate bases to
best gauge of the long-run profitability of a allocate costs
segment. 

 Net Operating Income/Loss of the Segment – result

after deducting the allocated common fixed
expenses not traceable to the individual segment
from the segment margin

Problems Related to Proper Cost Assignment

 omission of some costs in the assignment process.