If sales increase, so should profits. Yet, the opposite result often leaves executives scratching their heads. When organizations work with inferior cost information, they make mistakes in four specific situations. Bad information causes sellers to overprice easy, high-volume work and underprice difficult, low-volume work. This session discusses how to use activity-based costing data to build accurate costing models that consider far more than just the labor and materials necessary to provide goods and services.
Learning Objectives
- Increasing profits
- Build accurate costing models
Major Topics
- Building computer costing models & sub models
- The importance of volume sensitive models
- Your twelve most important indirect costs
- Using rate tables
- Modeling – Professional Services Job Costs
- Modeling – Repetitive Manufacturing
- Why return on sales may be an inferior way to plan for profit
