Discuss the reasons why activity-based costing may be preferred to Essay

Discuss the reasons why activity-based costing may be preferred to traditional absorption costing in the modern manufacturing environment - Essay Example This paper discusses the various reasons why most firms use activity-based costing methods over the tradition absorption method. There are mainly two costing methods used by companies in different manufacturing environment that include absorption and activity-based costing techniques (Needles, Powers and Crosson, 2011). The Modern Manufacturing Environment involves the use of modern technology in the manufacturing industry. The use of technology enables organisations to reduce the cost of labour and increase production rates. In addition, modern manufacturing environment entails production of large volumes of goods at a cost, which promotes the companys profitability. The primary characteristics of a modern manufacturing environment include the following. First, the manufacturing environment entails an intense competition internationally. Most of the firms that operate on modern manufacturing environment experience high levels of competition on an international platform. For example, companies operating in the automobile industry experience great competition internationally, which require them to reduce production cost in order to initiate cost, based competition strategies (Lembersky and Lembersky, 2005). Secondly, the modern manufacturing environment involves rapid innovation in production. Production innovation is essential in establishing cost effective production methods such as automation of the production line and use of digital systems to reduce the cost of power and labour (Frost, 2005). Thirdly, the environment involves the use of automated machinery, which minimises the cost of labour. Automation of the production line ensures that most of the operations of the company rely on technology, which reduces the cost of production (Lembersky and Lembersky, 2005). Finally, production in a modern manufacturing environment involves

Federalism As a System of Government Essay Example | Topics and Well Written Essays - 1000 words

Federalism As a System of Government - Essay Example The present research has identified that federalism promotes diversity in the system by allowing states and provinces to devise their own policies in matters related to public welfare such as education, health, and agriculture whereas at the same time it also ensures the unity among the various units of the states by giving the national responsibilities like currency, foreign affairs and defense to the central government. Federalism creates a very healthy political environment in the country which ensures political activity at the grass root level as well because the system of provincial and the system of local governments directly involve people in political activity. In this way people get to know about correct policy making and various policies can be tested in the country at the same time; better political grooming ensures better political leaders as well. Due to the disintegration of powers to various systems of governments reaching the grass root level through local and provinc ial governments, federalism provides a system in which good governance can be ensured. Each government has its own responsibility, federal government is responsible for the security of the country, provincial governments are responsible for the welfare of the public whereas local governments are responsible for providing services to the public; in this way the duties are divided and governments can work with greater efficiency and their performance is greatly enhanced. ... Federalism has turned out to be a very successful system of government however it has certain disadvantages as well. It allows certain disorderly members of the society to manipulate laws of taxation on various different commodities by purchasing and using them in different states because the government cannot impose tax or duty on interprovincial transfer of goods. The diversity in other laws which include laws related to criminal offense also allows the wrongdoers to escape punishment by moving to another state where the offense is not punishable under law. The laws related to social contract like marriage and inheritance are also exploited by people due to diversity among them in provinces and states. In certain situations the system of federal government allows interstate conflict to occur because certain projects related to natural resources and infrastructure which are beneficial for one state can affect people and the interests of any other state, in such a situation a riv alry between the states is promoted and thus the spirit of nationalism is greatly damaged. Federalism very often leads to disputes between states over the division of resources and responsibilities among the states. The federal system of government with its all system of governments is economically very costly to support because there is a large number of elected representatives and officials in the government which are salaried by tax money (Freely and Rubin). The presence of three parallel systems of government also creates complexity in the governance. The federal government is always biased towards one or another province because of the inherent attachment with a political party and thus in certain areas of governance where the provinces and