3310solmod18 - important that the reported costs reflect to...

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Module 18 Answers 8-4. The costs include the systems and the software, but the most important cost is managers’ time. Managers need to make many decisions about the activities and the cost drivers and managers need to make many of the first stage allocations. The benefits come from having better information about the use of resources and better information for decisions. 8-6. False. While the total cost allocated is the same, the reported costs for individual products will differ. Because managers make decisions at the product level, it is
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Unformatted text preview: important that the reported costs reflect, to the extent possible, the use of resources by the products. 8-13. There is no rule that the price charged for a product has to exceed its cost. There may be important marketing or strategic reasons why a company wants to be in a particular market. However, to ensure that this is a good decision, the firm should have the best information on cost that it can get. Managing a company by fooling yourself into thinking something costs less than it does is not smart....
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