外部報告를 위한 直接原價計算의 問題點

Direct Costing Controversy

Introduction Not less than a century has passed since the systematic study of cost accounting had begun. It is generally conceded that accounting originated with the rise of the factory system in the Industrial Revolution in England. Around the turn of the century, most product costs came to include factory overhead to product as well as prime costs. In this early efforts to charge factory overhead to product, historical costs were generally used, based on actual materials and labor as well as actual overhead costs. However this method of costing couldn't meet the increasing problems of cost estimating and compatible pricing. Accordingly predetermined overhead rates had finally gained acceptance by 1910. Next development in costing was standard costing which emerged during 1920's. Standard costing devices started from the critical stand of past retrospective or post-mortem cost accounting. According to the development of increasing complexity of modern industrial system, cyclic and seasonal business field really needed the predetermined cost accounting. During 1930 to 1950, in accordance with the development of managerial uses of costing, cost accounting came to devote to business as management tools i.e., budgeting, break-even analysis, ratio analysis, profit planning and distribution cost analysis. Looking back to the development of cost accounting, it seems to be a natural step in the evolution of overhead costing. Again early in 1950's direct costing emerged as a new approach to overhead costing. The fundamental ideas of direct costing were first publicized in 1936 by Jonathan H. Harris in an article titled "What Did We Earn Last Month?" Under this method fixed factory overhed is not assigned to product. Direct costing differs from conventional costing, sometimes called absorption costing, because fixed factory overhead is treated as a period (charged against revenue immediately) rather than as a product cost (assigned to units produced). Direct Costing versus Absorption Costing The difference between direct costing ("variable costing" is more appropriate) and traditional absorption costing lies in the elements of varaiable overhead cost that are to be included in the cost of goods sold, and in the final inventories. So the direct costing should be defined as a segregation of manufacturing costs between those which are fixed and those which vary directly with volume. The costs of the product are composed of only variable costs and fixed portion of the costs are directly charged against to the revenue of current period. According to this principle of direct costing, this method of costing is different from abosorption costing in three points; 1. Classification of costs, 2. Order of charging costs to revenues, and 3. Valuing the inventories. The motivation of direct costing stems from the ever incresing mechanization in American industry. With the increase of the scale of business, overhead becomes ever larger element of cost since a substantial portion of this elements largely non-variable in nature, seasonal and cyclic variations in production and sales tend to build up in the inventory, thus reducing the amount of the current period's costs until such time as the inventory is sold. During this period of heavy production, conventional absorption costing may show profits to be high, even though sales are low. During the reverse cycle, the opposite will usually be true. As mentioned above, under direct costing, inventories are to be valued at direct or variable costs, while fixed cost would be charged directly to expense in the current period. The basic difference in profit and loss statement between absorption and direct costing is that, in case of absorption costing fixed costs are included in inventory, and direct costing, which includes only direct or variable costs. Undoubtedly this method of direct costing is generally conceived as an accepted technique of internal reporting to management, especi