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Abc System Report

In: Business and Management

Submitted By ouioui
Words 2351
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Table of Contents 1. Introduction: 2 2. Three voice telecommunication costing system: 3 2.1 Overview about three system: 3 2.2 The differences between 2 common system 1995-1998 and 1999: 4 3. Overcharging of the 1995-1998 system: 5 4. Assessment of overconsumption in 1995-1998 period: 6 5. Cost savings through reduced consumption in the 1999 system: 7 6. Conclusion: 8 7. Recommendation: 8 Appendix 1: Calculation cost of a large and a small customer in 1995-1998 system and 1999 system 9 Appendix 2: Calculation cost of actual usage in 1998 and proposed usage in 1999 under 2 systems in Huntsville Division 10 Appendix 3: Cost savings company get and lost 11 Ciatation: 12

1. Introduction:
For several past years, there had been some issues about the costing system for allocating voice telecommunication services in the Boeing Company that interested many managers in company. One important issue that whether activity-based system was more useful than simple system or not. Although it still has some arguments about usefulness of simple costing system and activity-based costing system on allocating cost, there is no doubt that each system had its own benefits and helped managers managing overhead and understanding profitability of products and customers, is a powerful tool for decision making. The main purpose of this assignment is providing a general evaluation on Boeing’s voice telecommunication services through activity-based and simple systems. Our assignment will cover all of advantages and limitations of each voice chargeback system with the objective appreciation.

2. Three voice telecommunication costing system:
Boeing company used three different systems through 3 periods: prior to 1995, 1995-1998, 1999 3.1 Overview about three system: Prior to 1995:
The old chargeback system is the system that too much detail…...

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