Determine the cost of product using activity based costing, Business Management

Assignment Help:

A data switch company specialises in the production of switches that can be used to link several personal computers to a shared printer. The company manufactures a low-cost manually operated data switch and a more expensive automatic data switch. Both types of switches are packed in multiples of five before they are despatched to retail outlets. An analysis of the company's production reveals the following:

 

Manual data switch

Automatic data switch

Production volume

1500

500

Direct Material's cost

£20/unit

£30/unit

Activity based production analysis:

 

 

Set-up cost

1@£15,000

1@15,000

Manufacturing costs

500@£4/unit

500@£10/unit

Assembly cost

500@£2/unit

500@£4/unit

Packaging

300@£10/unit

100@£10/unit

Despatch/delivery

300@£20/unit

100@£20/unit

1 Determine the cost of each product using activity based costing?

2 Discuss the suitability of this type of costing for the engineering business of this company and the company you established in Task 1.

3 Measure the impact on the business performance of changing all the company products from Manual to Automatic data switch and producing the whole production volume (2000 units). Discuss the advantages and disadvantages of such activity on the performance of the whole business.


Related Discussions:- Determine the cost of product using activity based costing

Control of product during inspection, Inspection of production takes time...

Inspection of production takes time which may extend from a few hours to a number of days depending upon the nature of the product. It is necessary to exercise suitable o

Organisational behavioure , For an organisation that you know well (e.g., t...

For an organisation that you know well (e.g., the organisation, where you are currently employed or for which you worked in the past), using the relevant concepts, theories and mod

Business process modelling notation, You must create a fictituous supply ch...

You must create a fictituous supply chain (loosely based on a real world system) that has at least three companies A, B and C.  Each company will have its own ordering, invoice and

Email etiquette is vital in any business communication, QUESTION 1 Desc...

QUESTION 1 Describe how cultural diversity affects business communication, giving three advantages and three challenges of a diverse workforce. QUESTION 2 A team is a u

Business Report, Select an Australia based mobile service provider. This bu...

Select an Australia based mobile service provider. This business should have its operations in the Australian market and should have a legitimate website. Some of the options could

Briefly describe the role of business intelligence, (a) Briefly describe th...

(a) Briefly describe the role of Business Intelligence (BI) in the modern organization. (b) Discuss the organisational decision making process and identify how various Busine

Explain the different delivery styles that speakers, Explain the different ...

Explain the different delivery styles that speakers can select for their presentation

Effects of accidents, Effects  of Accidents The  accidents are  always ...

Effects  of Accidents The  accidents are  always undesirable.  They result in  loss of life  and property. They  produce evil effects  on workers, families employers and on the

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd