KanthalEssay Preview: KanthalReport this essayMajor Issues and General ScenarioGeneral Scenario:Kanthal is a successful and profitable company that is a worldwide market leader in many of the products that it produces. Nevertheless, its new president feels that the company needs a new strategy that will provide it with a way to further increase profits but without increasing costs.
The new president believes that the key to the new strategy is to be able to understand the true nature (i.e. costs) of customers and orders. He feels that if the company is able to tie costs o customers in an accurate manner, it will enable the company to better focus on higher profitability.
Major Issues:Understand the cost structure of the company.Allocate costs on a per customer and per order basis.Implement a new cost system that will support the new cost allocation methodology.Improve decision making on customers and sales orders based on the information provided by the new system.Case QuestionsWhat was the president trying to accomplish?Basically, the president was trying to accomplish a move from a traditional cost accounting system to a new, ABC accounting system. This, in order to identify what are the true costs of each customer and each order, enabling the company to fully understand its cost structure thereby providing the base for better business choices (and higher profitability).
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In order to understand why you guys are doing this, we had to be very specific so we could make sure you were aware of these key things.
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In order to understand why you guys are doing this, we had to be very specific so we could make sure you were aware of these key things.
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In order to understand why you guys are doing this, we had to be very specific so we could make sure you were aware of these key things.
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