M6-27c&d - costing would have to be under costing...

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c. In addition to the manufacturing cost information provided by ABC, management will need to have additional information about non-manufacturing costs such as distribution and customer service. d. The finding in the above requirements could have multiple implications for Outback Luggage. The manager should be pleased that both Jobs 201 and 202 had ABC costs less than their costs under traditional overhead costing. However, what this also means is that traditional
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Unformatted text preview: costing would have to be under costing some other types of jobs. While it may be encouraging that the two jobs in this exercise are more profitable than previously thought, it should be of serious concern that other jobs are not as profitable as management may have thought. A full cost analysis of all jobs should be conducted before management can assess the full impact of the errors resulting from using the traditional overhead costing system....
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