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TASK
Understanding the true costs of serving a customer is an invaluable information that a manager needs for making successful managerial decision to improve the performance of a business.
Required:
Question i. Provide a brief account of the major emphasis of the Activity Based Management (ABM) models.
Question ii. Explore the usefulness of activity-based costing in the implementation customer profitability analysis (CPA) in service industries.
Question iii. Discuss the possible drawbacks of ABC system despite being considered as a sufficient costing method in service industries.
Question iv. Using a hypothetical case, demonstrate how costs are allocated to different customer groups under ABC in implementing CPA.
Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.
Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.
Prepare a master budget for the three-month period.
Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.
Evaluate the Predetermined Overhead Rate
Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.
Complete the schedule to compute the pool rates for the different activities.
Prepare Company financial statements
This individual assignment is based on the TerraCycle Inc.
Discuss the ethical issues
Calculate the GDP in Income Approach and Expenditure Approach
A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.
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