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

Introduction to business planning, our CLC business plan I am responsible f...

our CLC business plan I am responsible for financial information I need a help

Where are the training and education different, Where are the training and ...

Where are the training and education different? The training and education are different from that of given level within content and method. 1. Work Force. 2. Middle Leve

Analyze the major determinants of cost efficiency, Question 1 Price or ...

Question 1 Price or market competitiveness of a product or business depends on its cost competitiveness. Cost competitiveness implies two things-cost efficiency and cost effect

Performance appraisal and career progression of individual, Define the perf...

Define the performance appraisal and career progression of individual. Performance Appraisal and Individual’s Career Progression: Performance appraisal assists in unearth

Total productive maintenance, Total Production Maintenance is to achieve...

Total Production Maintenance is to achieve maximum profit all employee to minimize maintenance costs. a facility can be kept in good condition only by autonomous action and th

Both opportunities and threats for each demographic, There should be consid...

There should be consideration of both opportunities and threats for maximum marks in each case. Award up to 3 marks for each demographic consideration. Examples of possible issues

Business Communication, Explain some of the approaches for handling custome...

Explain some of the approaches for handling customer complaints and listening to customers

Organization factors, There are certain factors which are related to th...

There are certain factors which are related to the polices traditions and environment of any enterprise. a. Labor relation policies of the organization. b. Amoun

Productions and manufacturing budget based factors, Which factors are the p...

Which factors are the productions and manufacturing budget based? The productions and manufacturing budget based is based onto: 1. Sales budget, 2. Factory capacity (Prod

Ability diversity, Individual with disabilities are an under utilized human...

Individual with disabilities are an under utilized human resources. Many organisations, today, are hiring people with disabilities and provide them opportunities to unleash their t

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