Journal Article Critique (30 Marks) You are required to conduct a literature search and discussion in this assignment. You are to choose a peer reviewed journal article (from any country) on the: -...

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Running Header: Journal Article Critique
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Journal Article Critique
Journal Article Critique
Abstract
This report undertook a critique of two journals for undertaking critical assessment and review of two costing approaches – standard costing and target costing. The system of standard costing represents a tool to plan budgets, manage as well as control costs, and to evaluate performance of cost management and this system entails the estimation of costs required for the production process. Target costing can be defined as the disciplined and structured process to determine as well as achieving full-stream cost by which the product / service at hand with specified performance, quality, and functionality, need to be produced for the purposes of generating desired levels of profitability at selling price anticipated for the product over specified period in time over the future. The computation of the standard cost shall be focused inwardly, and will not need the consideration of the prices, profits, etc., while in contrast, target costing shall start with the external market place selling prices with respect to the specific product / services and later work backwards to the target cost calculated by way of deducting the required profits. The detailed analysis, comparative assessments, findings and recommendations are presented in this report.
Table of Contents
Abstract    2
Introduction    4
Standard Costing: Planning & Control System    4
Standard Costing: Identified Article Discussion    5
Target Costing & Comparative Assessment    6
Target Costing: Relevance    7
Recommendations    8
Conclusion    8
References    10
Introduction
This report undertakes critique of two journals for undertaking critical assessment and review of two costing approaches – standard costing and target costing. The system of standard costing represents a tool to plan budgets, manage as well as control costs, and to evaluate performance of cost management and this system entails the estimation of costs required for the production process. Target costing can be defined as the disciplined and structured process to determine as well as achieving full-stream cost by which the product / service at hand with specified performance, quality, and functionality, need to be produced for the purposes of generating desired levels of profitability at selling price anticipated for the product over specified period in time over the future.
The two journal articles identified for this report include the following: Rao & Bargerstock (2011) and Woods et al. (2012). Rao & Bargerstock (2011) undertook their study for understanding current state in terms of the practice of using the system of standard costing specifically variance analysis across manufacturing enterprises based in United States that employ lean approaches as well as for understanding the reasons if and why these companies may decide on retaining the standard costing. Woods et al. (2012) undertook their study for contributing towards literatures of both management accounting as well as value-based management by way of analysing system of target costing at Electronics, a MNC based in Europe; and by way of this study found preliminary evidence for using target costing to align myriad perspectives, and by combining with techniques of strategic management based accounting the same could aid in bridging of connecting the strategy formulation to that strategy execution as well as profit generation.
Standard Costing: Planning & Control System
The system of standard costing represents a tool to plan budgets, manage as well as control costs, and to evaluate performance of cost management. The system of standard costing entails the estimation of costs required for the production process (Rao & Bargerstock 2011). Yet prior to the starting of a specific accounting period, determining relevant standards as well as establishing the relevant amount as well as costs pertaining to direct materials shall be needed with respect to the production process as well as the pay rates and the amounts concerning direct labour that are needed with respect to production process. Further additionally, the said standards shall be utilized for planning the budget in relation to production process (Rao & Bargerstock 2011). Over end of accounting period, usage of actual amounts as well as costs concerning the direct materials shall be done. Subsequently actual amounts as well as pay rates for direct labour shall be utilized for comparing it with the standards previously established. When one compares actual costs with that of standard costs as well as examines these variances in-between them, the same enables managers in looking for the ways for improving cost management, cost controls as well as operational efficiency (Rao & Bargerstock 2011).
In addition, standard costing offers valuable form of tool to exercise managerial control within various environments but specifically with respect to mass manufacturing. Standard costs represent pre-determined form of unit costs employed for estimating the cost pertaining to the output (Rao & Bargerstock 2011). The costs so estimated shall be reconciled periodically to that of actual cost which are incurred for determining deviations referred as variances. In effect, cost accountants identify that the variances take place by way of two wider sources, that is, price as well as efficiency. The price variances which take place on account of variation in-between pre-determined or standard prices to that if actual prices that are paid with respect to inputs employed in the production. In summary, price variances represents the differences in-between actual price as well as pre-determined price concerning the input quantity (Rao & Bargerstock 2011). Further, efficiency variances take place on account of variation in-between these pre-determined levels in the inputs allowed as well as...