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Summary Acc 349 Team 4 Jeemp Farms ABC Part 1.docx ACC/349 Team 4 - Jeemp Farms ABC - Part 1 ACC/349 Jeemp Farm Analysis - Part 1 We have a task at hand to analyze the declining net profits Jeemp Farms has experienced in the past two years. Based on $7.49
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Summary Acc 349 Team 4 Jeemp Farms ABC Part 1.docx ACC/349 Team 4 - Jeemp Farms ABC - Part 1 ACC/349 Jeemp Farm Analysis - Part 1 We have a task at hand to analyze the declining net profits Jeemp Farms has experienced in the past two years. Based on
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Course
RAS
Institution
Rasmussen College
Acc 349 Team 4 Jeemp Farms ABC Part ACC/349 Team 4 - Jeemp Farms ABC - Part 1 ACC/349 Jeemp Farm Analysis - Part 1 We have a task at hand to analyze the declining net profits Jeemp Farms has experienced in the past two years. Based on the email you sent, Mr. Beridon, you feel the prod...
acc 349 team 4 jeemp farms abc part 1docx acc349 team 4 jeemp farms abc part 1 acc349 jeemp farm analysis part 1 we have a task at hand to analyze the declining net profits jeemp
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ACC/349
Team 4 - Jeemp Farms ABC - Part 1
ACC/349
Jeemp Farm Analysis - Part 1
We have a task at hand to analyze the declining net profits Jeemp Farms has
experienced in the past two years. Based on the email you sent, Mr. Beridon, you feel the
production and sale of the pecan tree sector are more profitable because of the demand. Still,
the sod portion of Jeemp Farms can also benefit the organization's profitability. We
understand that the pecan trees appear to be more profitable from a surface view, but there are
other manufacturing and non-manufacturing overhead costs we will analyze (Garrison,
Noreen, & Brewer, 2015). There is a potential indirect cost that may be hidden and difficult to
identify based on a traditional costing method. We will conduct an in-depth activity-based
costing (ABC) analysis to gain a clear picture as to what is contributing to the net declines.
We are committed to providing you with our recommendation after our analysis is
concluded. We will give you all the information you need to determine how to proceed with
your business. We will break down all costs and returns in deciding which part of his
business is profitable. While we use ABC, we will look at the cost and time it takes to produce
the pecan trees. We may find that the cost cancels the profit generated. We will also look at
the break- even period. These are all crucial aspects of your business that should be
considered before making a hasty decision.
Benefits Using ABC System
, There are many benefits to using an ABC system when wanting to price your
products accurately. ABC will allow you to allocate your costs more precisely, allowing
management to make better decisions. Allocating your price per product will allow you to
understand each product's profit margin better. Using an ABC system will give you a better
grasp of your
inventory and overhead so that you know your exact expenses. This will allow you to see your
profit more clearly. As you know, with any company, growth and profit are imperative for the
company's success. With ABC, we will tell you which products are unprofitable, what your
actual costs are, and get rid of any unnecessary costs. We will create an analysis to show you
currently what you are reporting now with costs and profit. We will do this by going over with
you your expenses and how you are spending your money. We will also go over with you the
pricing and see if you are competitive and cost-effective. Then the ABC system shows you
what your true overhead and profits are. We will show you if you need to discontinue your
sod business or continue it and reduce costs in other areas that may not be as profitable as you
may have thought.
How would you apply the data in the company's general ledger?
Activity-based costing is not a replacement for the company's general ledger, but a
way to translate the data into an easy to read format that will enable managers and owners to
make intelligent decisions. The items on a general ledger give the base reporting information
for the products that are manufactured. This is mainly used by the shareholders, partners, and
business representatives to see a quick overview of how the business is doing. Again, this is a
general overview, not giving any insight into what goes into producing, manufacturing, or
running the business.
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