BIG Manufacturing Products Has Been Using FIFO Process Costing for Tracking

question 59

Essay

BIG Manufacturing Products has been using FIFO process costing for tracking the costs of its manufacturing activities. However, in recent months, the system has become somewhat bogged down with details. It seems that, when the company purchased Brown Electronics last year, its product lines increased six-fold. This has caused both the accountants and the suppliers of the information, the line managers, great difficulty in keeping the costs of each product line separate. Likewise, the estimation of the completion of ending work-in-process inventories and the associated costs has become very cumbersome. The chief financial officer of the company is looking for ways to improve the reporting system of product costs.
Required:
What can you recommend to improve the situation?

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Definitions:

Inquisition

A group of institutions within the Catholic Church charged with the eradication of heresies, noted for its methods of interrogation and punishment.

Chronological Order

Chronological order is the arrangement of events or actions in the sequence of their occurrence in time.

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Colonial foundations refer to the early settlements, institutions, and systems established by colonizing powers that significantly influenced the development and history of the colonized regions.

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Variations in beliefs, practices, and doctrines among different religious groups, often a source of conflict or diversity within societies.