Dhara Rami ACCT 442 Dr. Szendi Date: November 2‚ 2014 Towson University Dakota Office Products Case Analysis Dakota Office Products Case Analysis Introduction Dakota Office Products (DOP) is a reseller and supplier of office products. DOP is a regional entity. It has institutional and commercial businesses as clients. DOP has a good loyalty and customer confidence from its client. In order to increase profitability‚ DOP started “Desk top” delivery for its loyal customers. In this service
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Dakota Office Products Background • Regional distributor of office supplies to institutions sand commercial businesses • Comprehensive product line • Excellent reputation • Several distribution centers Process • Old: • After customer orders received‚ orders were accumulated within the warehouses and prepared for shipment • Used commercial truckers to deliver • New Option: • “Desk Top Deliveries” • Delivered products directly to locations • Small fleet of trucks • 2% upcharge on products Pricing
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Case: Allied Office Products Company A costs Allied less money to service‚ they are also a much smaller source of potential growth for the company. Company B on the other hand utilizes far more services and has the potential to earn Allied much greater revenue. With the information we have from the new ABC costing scheme we now know that Allied should be charging far more for the services rendered to company B‚ and less for the services used by company A. Current information shows that company B
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Allied Office Products Case Objective: This case provides practice in Activity-Based- Analysis (ABC) calculations for a service company. It also highlights the important considerations in moving from ABC to Activity-Based Management (ABM) and further into Strategic Cost Management (SCM) so as to influence customer behavior and profitability. Q1. Using the information in Exhibit 2 calculate ABC based service costs for the TFC distribution/warehouse services. These are some broad steps that
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The Midwest Drought: Can Global Warming Be Blamed? The drought which swept across the Midwestern United States in the summer of 2012 has been the most severe and widespread drought of the past 50 years. The population of the Midwest is approximately 61 million people and the region includes the states of Illinois‚ Indiana‚ Iowa‚ Kansas‚ Michigan‚ Minnesota‚ Missouri‚ Nebraska‚ Ohio‚ North and South Dakota and Wisconsin. The percentage area experiencing moderate to exceptional drought in the Midwest
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1 Dakota current allocates warehousing‚ distribution and order entry cost equally to each customer. DOP’s pricing system is generally independent of the specific level of service provided for customers. They just chose a single cost drive. However‚ it’s not believable and proper to use this simple method to analyze costs when costs are more complex. So we need to use activity-based cost system to chose different cost drives and allocate costs based on the activity. 2 We identify four different activities
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Office Dakota Products Case Analysis Course: BUSA 5061 Managerial Accounting Students Name: Teresa Willette Professors Name: Dr. Conner/Dr. Pollard Date 3/20/2011 Executive Summary The following analysis is written for Dakota Office Products to evaluate current business operations and recommend future actions necessary to ensure company success. In the analysis of the company we will identify inefficient business practices that have led to the companies first profit loss in its history. We will evaluate
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cost determination for individual customers - wrong cost determination for new services provided by DOP (to small charges for the “desktop” delivery‚ then the actual cost of it) 2. Develop an activity-base cost system for Dakota Office Products based on Year 200 data. Calculate the activity cost-driver rate for each DOP activity in 2000. Activity cost-driver rates: Activity One: process cartons in and out of the facility Rate=(90% of Warehouse Personnel Expense + Cost o Items
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assigned and allocated to products and services delivered to clients. This system has proven beneficial for companies where production operations are high labor intensive and overhead costs are smaller part of total costs. Nowadays‚ when automation and technology are ubiquitous overhead costs make up much higher percentage and are often lumped together with direct labor costs. An ABC approach would be much more appropriate for the DOP’s business as it will calculate costs of products and services based
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Planning Better and Using What Yahweh Gave Us All of us in life need to appreciate what Yahweh has given us. He has given us food‚ shelter and clothing. We need to be grateful for what he saw fit to bestow‚ as we could just be here alone and starving. Our blessings are many‚ that of a house‚ family and resources to use. We have talents of cooking‚ cleaning and playing music. Yahweh has given us people to minister to and to fellowship‚ especially with our musical talents. Deuteronomy 28:2-6: And
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