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Welcome to IKEA Dhahran

Accounting Procedure at IKEA. Sales Reconciliation (similar to retailers)Daily expense (local purchase)Stock Adjustments (daily stock transfers)Salaries and WagesCentral cost allocation (branch transfers)Annual inventoryOthers. Cost Accounting and Pricing of Products. The base of pricing pro

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Welcome to IKEA Dhahran

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    1. Welcome to IKEA Dhahran Cost Accounting Principals

    2. Accounting Procedure at IKEA Sales Reconciliation (similar to retailers) Daily expense (local purchase) Stock Adjustments (daily stock transfers) Salaries and Wages Central cost allocation (branch transfers) Annual inventory Others

    3. Cost Accounting and Pricing of Products The base of pricing products (what is customer willing to pay?) Target pricing and target cost: Develop product that satisfies the customer Choose a target price based on customer’s perceived value Drive a target cost per item =target price - target operating income Perform value engineering to achieve target costs Volume drive the selling price at IKEA

    4. Waste Management and cost of disposing wastes Our ambition is minimize waste in stores: Motivate the customer to buy Product in as shape as new Create trust with our customers Motivate the coworkers Cost of disposing items? Its impact on profit (the more damage the less profit) How to minimize cost of waste items

    5. Cost-Volume-Profit Analysis The impact of volume on cost and profit Stock turnover How to steer towards profit Frequent analysis of margin Competition and its impact on profit Identify opportunities to maximize bottom line

    6. Budgeting and Control The process of budgeting Departments’ needs Create value to the customer (customer is in the heart of your routine) Expense budget based on sales Monthly analysis What’s in it for me?

    7. Any Questions?

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