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How does a customer benefit by our spending

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Case Scenario - The Senior Manager of a company refused to implement an activity-based costing system as recommended by the Accountant because it would cost approximately $40,000 to implement this new system. The Accountant explained that because the company has many products that are produced using different amounts of indirect resources, then ABC would be worth the cost. The Manager felt that better use could be made of the money such as investing in projects that could yield positive returns or using the money to improve customer satisfaction.

Question 1 - How does a customer benefit by our spending $40,000 on a supposedly better accounting system?

Question 2 - How should the Accountant respond?

Reference no: EM132474200

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