Allied Office Products Case Essay
Q1. Using the information in Exhibit 2 calculate ABC based service costs for the TFC distribution/warehouse services. These are some broad steps that can help. 1. Step 1 – Use Distribution Center Activity Analysis in the text (p. 30) and determine the cost (activity) driver for each of the activities in page 31. 2. Step 2 – Calculate the warehouse/distribution cost per unit of …show more content…
Q5. What advise to you have for Allied’s Management? What do you learn from Exhibit 6? * In TFC what are the real value adding service activities? * Can we tweak the value chain to improve the profitability of the current losers? * Would innovative management accounting practices (e.g., Target Costing, JIT) help? * Should Allied have moved up the value chain to provide TFC services? * Can you bring in the revolution that is going on currently in supply-chain management and logistics into understanding the dynamics of the case?
A Figure to illustrate Exhibit 2
Required: 1. Calculate the numbers for A through K and calculate $X and $Y. 2. Determine the costs of Customer A and Customer B?