What-If Analysis and Activity-Based Budgeting Forecasting Resource Demands Excerpted from Time-Driven Activity-Based Costing: A Simpler and More Powerful Path to Higher Profits By Robert S. Kaplan, Steven R. Anderson Harvard Business Press Boston, Massachusetts ISBN-13: 978-1-4221-2227-3 2227BC Copyright 2008 Harvard Business School Publishing Corporation All rights reserved Printed in the United States of America This chapter was originally published as chapter 5 of Time-Driven
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retrospect on recent meeting at Institute of Management Accountant. The Controller of Winjum Company had introduced the firm’s variable costing method, which charge Fixed Overhead To net income as a period expense and treated only variable cost as inventoriable product cost. Also stress that, variable costing caused income to move with sales only while full absorption costing both sales and production volume are affected. Wilcox, recast the June and July Income Statements and Balance sheets using variable
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OVERVIEW Brief description This toolkit provides guidelines on how to go about developing and monitoring a budget. It will help you with an overall organisational budget as well as with a budget for a specific project. It includes tools for estimating costs as well as tips for ensuring that your budgets meet the needs of your project or organisation. In the examples section we give actual examples of budgets and how they can be monitored. Why have a toolkit on budgeting? Budgeting is the key to
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(mostly Asia) Constantly evaluate manufacturing unit to determine cost effective methods based on global demand, foreign exchange, labor cost, raw material cost, etc. Appliance –Refrigerator Frigidaire Charlotte, N.C Northern Mexico and USA Laptop Dell Round Rock, TX Various locations (USA and Texas) Organic Juice Apple and Eve LLC Port Washington, NY Locations in USA Globalization helps in manufacturing of products in a more cost effective method and increases profitability. It also helps
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Indirect Cost Allocation Method Institution Name The cost allocation method is a process whereby an organization assigns a common cost to several cost objects (Diamond, 2003, pp. 1-28). Indirect costs refer to the overhead costs associated with providing an indirect service that are not readily attributable to a direct service (Mathieu, 2001, pp. 451-475.). The indirect cost allocation method is used as management accounting tools with an aim of helping an organization get an accurate idea of
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this course on Managerial Accounting! I hope everyone is doing well as we dive into the topic of Activity Based Management (ABM). Here are my thoughts: What are ABM and ABC, and how can both be used by management? ABM is a business process model focusing on the control of production or performance activities so that they improve customer value and enhance profitability. Basically, ABM helps companies and mangers to produce more efficiently, determine product or service costs more accurately and control
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the price increase and no impact on demand, we can assume that Wilkerson has a great product that will continue to create demand for them and allow them to maintain appropriate margins on this product. #2) Wilkerson should abandon their current cost structure and move toward the contribution margin approach. It is very difficult to know if a product is making profit if everything
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HOFSTRA UNIVERSITY FRANK G. ZARB SCHOOL OF BUSINESS “Educating for Personal and Professional Achievement” DEPARTMENT OF ACCOUNTING, TAXATION, AND LEGAL STUDIES IN BUSINESS ACCOUNTING 231 - COST ACCOUNTING SYSTEMS GRADUATE- 3 S.H. SP 2016 Section A: Wednesday, 3:30-5:50pm, CRN 21871, Starr 210 INSTRUCTOR’S NAME: Dr. Nathan Slavin OFFICE HOURS: Monday and Wednesday 2:25-3:25 LOCATION OF OFFICE: 043 Weller Hall PHONE NUMBER: (516) 463-5690 E-MAIL
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growth rate, management still found that the current system was allowing a wide variation in cost control. (Kimmel, et al, 2009, pg 865).When it was noticed that “orders with high margins were subsidizing orders with low margins” (Kimmel, et al, 2009, pg 867), in the current strategy, the need for a new strategy became apparent. The move to an activity based costing system (ABC) that will show the costs produced by each activity performed rather than the job appears to be the correct choice. Managements
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Sally Case One significant flaw in how overhead costs is allocated by Sally under in the ABC systems is, her application of the 150% for both the internal control and information systems departments. The flaw here is that Sally is kind of using both the ABC and the standard cost system at the same time in determining the charge out rate for the two departments. This will inflate the charge out rate for the internal control consulting, with the information system consulting been reduced, considering
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