generic product pilot project

As a controller at your company, you have been asked to assist with some employee-related questions.

Consider the product(s) that your company manufactures. Look to have a product that can have features added to it (customized), Your CFO is considering taking special orders to further advance sales. If this is possible, the CFO would like to begin with a pilot project. The generic product would remain the same; however, the client would have the option of customizing certain features to be added to the generic product.

The CFO asked you:

Can you explain if it is possible for production and accounting to manage the generic product pilot project? What type of costing system would this be called? Explain what this costing system means.

What would the difference in the costing system be, if any, from the process costing system now?

• What additional documentation would be needed for the custom work?
• Would you have any thoughts or concerns on this type of change in processing?
• Considering the background, prepare a memo in a Word document to submit to the sales supervisor (you create the name) with a cc to the CFO (you create the name).