This new cost system does not only account for the cost associated with the production, but also measures the special components costs, and order processing cost that will help the company to identify the actual cost of production related to the all mixed products complex situation.
It gives proper cost of product manufactured. Furthermore, where and how cost can be reduced, it depends upon the operational activities, material purchased, and by hiring cheap labor force However, the question arises as to how could a company reduce its cost to capture the market, when it does not know the actual cost of production.
Similarly, the cost was related to the inventory handling, purchasing, receiving, product development as well. Furthermore, the company could not trace the cost associated with billing, order, receiving, product costing and bidding, shipping and handling.
This is just a sample partial case solution. This would have led the company towards making loss, until it would reach the point of identifying it.
Please place the order on the website to order your own originally done case solution. Proper costing system gives the proper cost of product manufactured; otherwise unknowingly company is on loss, or break-even.
The strategy did not work, as some problems appeared in traditional costing system, where it could not capture the relation between the increased support costs, and the change in product mix.
Thus, it was necessary to come up with the actual cost to find ways to reduce it, otherwise the company could be in loss or break-even. In addition to this, new costing system captured the cost associated with the order processing, and cost related to the special components.
Some of the major expenses were left behind, such as cost related to order processing, and costs related to the special components.
New Cost System Siemens that had adopted traditional system to reduce the cost could not come to a solution, but later it realized that some cost associated with some part of production were not captured by the traditional system.
New costing system will increase the profitability, because the company has come to the actual cost of production.Home» Siemens Electric Motor Works (A) (Abridged) Siemens Electric Motor Works (A) (Abridged) HBS Case Analysis This entry was posted in Harvard Case.
Siemens Electric Motor Works (A) and (B) (Combined) case study solution, Siemens Electric Motor Works (A) and (B) (Combined) case study analysis, Subjects Covered Activity-based costing Cost allocation Cost systems Organizational structure Profit centers Transfer pricing by.
Siemens Electric Motor Work Case Study Help, Case Study Solution & Analysis & Siemens Electric Motor Work Case Solution Traditional Cost system vs.
New Cost System Traditional Costing system refers to the system adopted by Siemens El. View Homework Help - MACC 5P21 CASE ANALYSIS Siemens Electric Motor Works from MACC 5p21 at Brock University.
SiemensElectricMotorWorks(A)Team1 Summary Siemens AG, which located in %(9).
Siemens Electric Motor Works (A) and (B) (Combined) Case Solution,Siemens Electric Motor Works (A) and (B) (Combined) Case Analysis, Siemens Electric Motor Works (A) and (B) (Combined) Case Study Solution, Examines the cost of the system can help support a firm's decision to change strategy.
In the process, students are introduced to simple activity based cos. Examines Siemens' insurance policy for prices items moved between your manufacturing and purchasers divisions of the Motor Unit Works.Download