Activity Based Costing
1.0 BACKGROUND OF THE COMPANY
This report is basically consists of the details of the company that we managed to visit, AJ Food Industries. It’s focusing on the product costing which is how the company compute its unit costs in determining the proper amount of overhead cost. We proposed the company to use Activity-Based Costing which is multiple bases in considering the overhead cost. Its an advantage for the company that involved with complex manufacturing process. In this study, we take mayonnaise produced by AJ Food Industries in two flavors which are regular (MAYO BITES) and cheese flavor (CHEEZY MAYO). We analyze the current product costs for the both products, and we proposed the suggestion to adopt the Activity-Based Costing in order to compute the overhead cost effectively. Apart from that, this report also includes the owner profile, company background, product pricing, and the appendices, the pictures at the site visit.
AJ Food Industries (M) Sdn. Bhd was registered 5th September, 1998. The company was the pioneer among Bumiputra Companies to be involved in the local production of salad mayonnaise, under the brand name ‘JASMA'. Jasma first and main product is salad mayonnaise under named ‘MAYO BITES’ which had enter the market since 2000 after more than a year of intensive research and product development. Now they also produce other products like the local favorite chilli sauce and the more contemporary Malaysian flavors- the pasta sauce and barbecue sauce. The latest product that been produced is ‘CHEESY MAYO’. Jasma’s products have been endorsed with the HALAL certification from Jabatan Kemajuan Islam (JAKIM). The company have been successfully audited by Malaysian Health Ministry (KKM) for MeSTI Certification. Apart from that, the company also managed to involved in Groom Big program under SIRIM. Currently, the company is gearing up for GMP and HACCP Certification.
Basically, the company started out as a family business that is managed by
This report is basically consists of the details of the company that we managed to visit, AJ Food Industries. It’s focusing on the product costing which is how the company compute its unit costs in determining the proper amount of overhead cost. We proposed the company to use Activity-Based Costing which is multiple bases in considering the overhead cost. Its an advantage for the company that involved with complex manufacturing process. In this study, we take mayonnaise produced by AJ Food Industries in two flavors which are regular (MAYO BITES) and cheese flavor (CHEEZY MAYO). We analyze the current product costs for the both products, and we proposed the suggestion to adopt the Activity-Based Costing in order to compute the overhead cost effectively. Apart from that, this report also includes the owner profile, company background, product pricing, and the appendices, the pictures at the site visit.
AJ Food Industries (M) Sdn. Bhd was registered 5th September, 1998. The company was the pioneer among Bumiputra Companies to be involved in the local production of salad mayonnaise, under the brand name ‘JASMA'. Jasma first and main product is salad mayonnaise under named ‘MAYO BITES’ which had enter the market since 2000 after more than a year of intensive research and product development. Now they also produce other products like the local favorite chilli sauce and the more contemporary Malaysian flavors- the pasta sauce and barbecue sauce. The latest product that been produced is ‘CHEESY MAYO’. Jasma’s products have been endorsed with the HALAL certification from Jabatan Kemajuan Islam (JAKIM). The company have been successfully audited by Malaysian Health Ministry (KKM) for MeSTI Certification. Apart from that, the company also managed to involved in Groom Big program under SIRIM. Currently, the company is gearing up for GMP and HACCP Certification.
Basically, the company started out as a family business that is managed by