Unit #1: Costing Systems

Lesson Title: Introduction to Job Costing Systems

Lesson 1 of 7 | Duration: 75 minutes | Year 13 Business Students
Curriculum Area: Business Studies
NZC Level: Level 8 – Aligned to NCEA Level 3 Business Studies and Accounting standards

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📘 Learning Intentions

By the end of this lesson, ākonga (students) will:

• Understand the purpose and uses of job costing systems in a business context
• Identify the key components of a Job Cost Subsystem: direct materials, direct labour, and manufacturing overhead
• Recognise how accurate job costing contributes to effective financial decision-making and profitability
• Begin exploring how job costing applies to New Zealand businesses, especially in service and manufacturing sectors

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📋 Curriculum Links

This lesson directly supports achievement of:

• Accounting—Level 3, AS 91408: Demonstrate understanding of management accounting to inform decision-making
• Business Studies—Level 3, AS 91380: Demonstrate understanding of strategic response to external factors by a business
• Aligns with Key Competencies: Thinking, Using language, symbols, and texts, and Participating and contributing
• Embeds principles from Te Tiriti o Waitangi by valuing mana ōrite mō te mātauranga Māori and diverse learning perspectives

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🧠 Prior Learning

Students are expected to have basic familiarity with general accounting terms and internal tools used for cost allocation in businesses. This unit will deepen their understanding by breaking down job costing intricacies.

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🛠 Materials Required

• Whiteboard + markers
• Printed handouts: Fictional business scenario and Job Costing breakdown sheet
• Access to calculators
• Digital collaboration tool (Google Slides or Jamboard alternative)
• "Mystery Box" envelopes (see below)

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⏱️ Lesson Breakdown

1. Karakia & Whanaungatanga (5 minutes)

Begin with a short karakia (teacher’s choice) and a tikanga-based check-in to strengthen whanaungatanga. Each student shares one word to describe how they’re arriving today, promoting whakawhanaungatanga and wellbeing.

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2. Hook: “Cost Me If You Can” (10 minutes)

Activity Type: Interactive Game Introduction

• Teacher displays a mysterious product box on each table, containing either a handcrafted item (e.g., felt wallet, woodwork piece, or art drawing).
• Each group (2 students per group) opens the box.
  • Inside is a “Job Card” stating the item’s material cost, time spent by the maker, and an unknown overhead.
  • Students guess how much it would cost to produce 10 more of those items.
• Groups share their logic before the teacher reveals that this question mirrors what a Job Costing System does daily.

🎯 Purpose: Sparks curiosity and real-life application thinking.

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3. Direct Instruction: Key Concepts (15 minutes)

Activity Type: Mini-Lecture + Discussion

Facilitated discussion with visuals:

• Definition of Job Costing System
• Business sectors where job costing is used in NZ – builders, designers, legal professionals, media producers
• Break down the components:
  • Direct Materials
  • Direct Labour
  • Manufacturing Overhead
• Connect to decision-making — quoting, pricing, tendering, profitability

🧭 Example used: A local pounamu jewellery business calculating per-piece cost using wage, materials, and operating costs

💬 Discussion Prompt: Why would a business inflate or underestimate job costs?

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4. Explore & Apply: KiwiBiz Simulation Activity (20 minutes)

Activity Type: Scenario-based group task

Each group receives a fictional business profile (printing company, custom furniture maker, Māori designer starting an eco business) and a set of job costing components.

• Using the template provided, each group calculates:
  • Direct Materials
  • Direct Labour (based on hourly wage x hours)
  • Allocated Overhead
• Groups complete cost estimates and present their job costing breakdown to peers.

🔁 Class compares how different businesses allocate overheads differently
🎓 Teacher circulates to offer support and prompt thinking with strategic questions.

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5. Reflections & Real-World Links (10 minutes)

Activity Type: Whole-class kōrero (discussion)

Guided group reflection:

• How does job costing impact business choices?
• What could be the risks of inaccurate costing?
• What skills from this apply to other areas of life/work?

✍️ Each student writes a “real-world takeaway” (1–2 sentences) on a sticky note and posts it to a designated wall chart called Aroha mo te Ako – a visible ‘learning love’ wall for future reference and celebration.

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6. Exit Card & Homework (5 minutes)

Exit Card Prompt:

• One thing I understand about Job Costing now
• One question I still have

Homework:

• Research ONE NZ business (local or national) you believe uses job costing — bring in 100–150 words about what they produce and why job costing might be essential to them.

📘 Optional Extension: Interview a whānau member or community business owner about how they track costs in their work.

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📊 Assessment for Learning

Formative Assessment:

• Observation of group discussions and costing accuracy during KiwiBiz Simulation
• Responses from sticky note reflections and exit cards
• Teacher notes any misconceptions or knowledge gaps to address in Lesson 2

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🌱 Differentiation / Inclusive Practice

• Scenarios adapted to include Pacific and Māori business models for cultural relevance
• Mixed-ability pairing to support learner collaboration
• Lesson integrates visual, auditory, and kinaesthetic modalities
• Offers bilingual terms where appropriate (wage = utu ā-haora, overhead = utu tāpiri)
• Allows for student voice and real-world connection

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🧭 Looking Ahead

Next Lesson:
“Tracking & Allocating Costs” – Exploring how businesses allocate overhead and apply cost-tracking methods using spreadsheets and cost sheets.

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📘 Teacher Notes

• Consider incorporating local mana whenua business examples next lesson
• Cross-field extension with Digital Technology or Visual Art could enrich understanding in making-trackable quality projects
• Keep each outcome connected back to the Big Ideas from the NCEA Business Matrix

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💬 Closing whakataukī

"Mā te huruhuru ka rere te manu" — Adorn the bird with feathers so it may fly.
Let us equip our learners with knowledge so they may soar confidently into the world of business.