PARADIGM A: THE ERA OF THE INDUSTRIAL REVOLUTION. 3

PARADIGM B: THE ERA OF COST-VOLUME-PROFIT ANALYSIS AND DIRECT COSTING. 3

PARADIGM C: THE ERA OF ACTIVITY- BASED COSTING. 4

PARADIGM D: THE ERA OF MARKET DRIVEN STANDARD COSTS AS OPPOSED TO ENGINEERING-DRIVEN STANDARD COSTS. 5

THE CHANGE IN THE RELATIONSHIP BETWEEN COSTS AND SELLING PRICE HIGHLIGHTED THROUGHOUT THE 20TH CENTURY 6

COMMENTS ON FERRARA’S THOUGHTS ON THE 21ST CENTURY PARADIGM 8

Paradigm A: The era of the Industrial Revolution.

The most important or the base of this paradigm was standard cost or the total cost per unit of output. When arriving the total cost per unit of output, almost all the costs including direct materials, direct labor, manufacturing overhead, and even marketing and administrative costs were accounted. As the final step of the process, to achieve the targeted or desired profit a target-selling price per unit was arrived. This was done by adding the desired profit or markup, to the total cost per unit. The bottom line of paradigm A was to achieve the projected costs per unit, to achieve t

Paradigm C: The era of activity- based costing.

The change in the relationship between costs and selling price highlighted throughout the 20th century

Manufacturing overhead $ 175,000

Some topics in this essay:
Costs Selling, Ingram RW, Comments Ferrara’s, Costs Manufacturing, Costs Variable, Industrial Revolution, Perter Drucker, Variable Manufacturing, ABC Costs, cost unit, selling price, Costing Variable, total cost unit, variable costs, total cost, paradigm era, fixed costs, desired profit, manufacturing overhead, marketing administrative, market driven, market driven standard, cost unit derived, calculating using unit, analysis direct costing,