The Design of Product Costing: An Exploratory Study

Abstract

The purpose of this paper is to investigate functions and the design of product costing in factories by empirical method. Although product costing still occupies the large proportion of the education, management accounting researchers have not analyzed this area so much. Then, this paper explores various elements of product costing, using not normative methodology but positive and empirical methodology. Analyzed by exploratory factor analysis, we found five functions of product costing. And these functions and some contingencies effect significantly on the scope of product cost, the selection of process or job costing, and the selection of who to be reported.