Question

Avoid plagiarism.. I want from your word please

Q1 Give example of company using ABC costing and explain the process used in this company to assign costs in an ABC system? (Week 7: ABC costing)

Answer:

      Q 2 Give examples of questions managers could ask to help them identify relevant qualitative factors that will be used before making decision? (Week 9: Relevant information for decision making)

Answer:

      Q 3 Kadhim Co. manufactures product B which is a part of its main product. Kadhim Co makes 50,000 units of product B per year. The production costs are detailed below. An outside supplier has offered to supply 50,000 units of product B per year at $ 2.45 each. Fixed production cost of $ 40,000 associated with the product B are unavoidable. Should Kadhim Co make or buy the product B?

The production cost per unit for manufacturing a unit of product B are:

Direct Materials	0.85
Direct Labor	0.65
Variable Manufacturing Overhead	0.40

Answer 1

Q 1 Activity Based costing is used by all major companies which product many products for example: The Coca Cola Company, Wrigley. In service industry it is used by KPMG and EY

Process used in ABC method to assign costs to the products

· The activities consumed for each product or service line are determined

· All the activities are pooled in a group called Activity cost pool

· Cost are assigned to each activities consumed in manufacture or delivery of service

· Activity rate is computed for each cost pool dividing the cost pool by total activities consumed

· Cost is allocated based on activities consumed by product or service line

· The activity rate is applied to products/services based on activities consumed and total manufacturing overheads is allocated

Q 2 Qualitative factors also play an important role in decision making with quantitative factors. Following are some of the examples of qualitative factors to be considered by managers and can be questioned in decision making

· Impact on employees morale and motivation

· Impact on the brand image of the products

· Impact on reputation of the firm

· Customer perception and preferences

· Tax and regulatory requirements

· Supplier reliability and support availability

· Quality of product