Finance Task #4 Carbon-Lite Bike

Memo To:Board of Directors From:Michael Allen Date: 10/07/2012 Re: procedure base representing Summary Report 1. Recommend whether the company should transfer its comprise method to exertion found constituteing. The Activity base equal accounting approach is comprised of matching the addresss with activities (These ar identify as the represent drivers) that cause those costs. This is similar to adding an additional bed of virtualization in computer storage area entanglement (SAN) carcasss in that a more granular kind of absorption-cost found system and replaces the labor-based cost system. Activity ground Costing presumes that: * products view activities * It is the activities (and non the products) that consume resources, * Activities are the cost drivers, and * Activities are not of need based on the volume of production. Instead of allocating costs to cost centers (such as manufacturing, marketing, finance), Activit y Based Costing allocates direct and confirmative costs to activities such as processing an order, attending to a customer complaints, or setting up a machine.

A subset of Activity Based Management (ABM), it enables management to better hasten into: * How and where the firm makes a profit, * Indicates where money is being spent, and * Which areas have the great potential for cost reduction? (WebFinance, Inc) Table: Activity Based Costing Analysis Competition Bikes. Item| Activity Cost Pool| Cost number one wood| Cost Driver quantity| Pool Rate| Product withdraw| Cost Driver Quantity for Product Line| Activity Cost for Product! Line| Product Line performance Volume| Activity Cost per Unit of Product| manufacturing plant| 33,400| Setups| 545| 61.284| te| 45| 2,757.80| 900| 3.06| Setups|  |  | |  | Carbon Lite| vitamin D| 30,642.20| 500| 61.28|  |  |  |  |  |  |  |  |  |  | Quality| 119,000| QC Inspections| 509| 233.792| Titanium| 9| 2,104.13| 900| 2.34| Control|  |  ...If you want to push back a overflowing essay, order it on our website: BestEssayCheap.com

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