Managerial Accounting

Final examination - 21 June 2023

Jason Iskandar
D21220058

Wenny Liono D21220064

 ?
Who is she
1933

36 plants in 22 countries

150 countries

390 distribution channel

10.000 dealers

2
Increasing globalization
Raising local…

• Production

• Sourced parts

• R&D

• Management functions

• Decision-making

3
Market share (Japan, 1990)
10%

20%
Toyota 45%
Nissan
Honda & Mazda
Else

25%
4
Preferences

Symbol
Single lifestyle
Multiple lifestyle
Single market

5
 Production stages
Conseptual design ——> Product development ——> Manufacture

6
Conceptual Design Stage (2 years)
• Identi cation using consumer analysis and mindset

• Appropriateness: performance, aesthetics, and

comfort

• Estimate the number of vehicles to be sold and the

cost associated with its development (life-cycle)

• Target pro t, target price

• Critical decisions about the model (body variations,

engine type, and basic technology used in vehicle)
7
fi
fi
Product Development (4 years)
• Detailed order sheet for the new model
100

• Produce the engineering drawings for trial production

75

• Suppliers asked to generate cost reduction ideas

50

• Increase the commonality of parts

25

• Reduce number of parts

0
• Construct prototype April May June July

8
Manufacture (4 years)

9
 Q1. Purpose of target costing system?

GOALS

• Increase market share

• Competitive advantage

• Core competences

• Following the consumer demand

10
 Q2. What approach could be used other than target costing?

ABC
CUSTOMER PROFITABILITY
ANALYSIS
• More accurate

• Improve decision making

• E ciency
APPROACH

Financial and non- nancial perspective

11
ffi
fi
 Q3. How you see the relationship of Value
Engineering, Target Costing, and ABC in the
Nissan Case?

12
 Q3.
Project cost/ ————————————> Order
Functionality Analysis Sheet
VE

—>
ABC Implementation
VE stage 1
system

—>
Cost Estimated Target
Costing

—>
Cost Reduction Draft Target Cost (Total
Allowable Cost ————————> ————————>
Required and by Function)

THE PRODUCT COST SYSTEM (pp.8-9)

13

 Q3.
Target costing

Consumer ——————> Mind Set ——————————————> Price Order

Analysis Analysis Range Sheet

————————>

————-——————>
—>
Price Range/
Functionality Analysis Far from allowable cost Near to allowable cost

VE
—>

Implementation
Project Cost/
Target Price ————————-—
Functionality Analysis
—>

—>
Target Margin ————————> Allowable Cost ABC system

STRETCH BACK
14

 Q4. How does the accountant roles in target costing system?

• Collaboration with marketing

• Authorize the actual selling price

• Set the target cost for each variant

15
 Q5. How target costing can bring benefit to Nissan?

• Products deemed ‘worth’ more than the consumer paid

• Easier to marketing the new products

• Increase market share of the new products

16
Thank you