TASK
Understanding the true costs of serving a customer is an invaluable information that a manager needs for making successful managerial decision to improve the performance of a business.
2
Required:
i. Provide a brief account of the major emphasis of the Activity Based
Management (ABM) models.
ii. Explore the usefulness of activity-based costing in the implementation
customer profitability analysis (CPA) in service industries.
iii. Discuss the possible drawbacks of ABC system despite being considered as a
sufficient costing method in service industries.
iv. Using a hypothetical case, demonstrate how costs are allocated to different
customer groups under ABC in implementing CPA.
.
TASKUnderstanding the true costs of serving a customer is an inv.docx
1. TASK
Understanding the true costs of serving a customer is an
invaluable information that a manager needs for making
successful managerial decision to improve the performance of a
business.
2
Required:
i. Provide a brief account of the major emphasis of the Activity
Based
Management (ABM) models.
ii. Explore the usefulness of activity-based costing in the
implementation
customer profitability analysis (CPA) in service industries.
iii. Discuss the possible drawbacks of ABC system despite
being considered as a
sufficient costing method in service industries.
iv. Using a hypothetical case, demonstrate how costs are
allocated to different
customer groups under ABC in implementing CPA.
