Business Essay

1118 Words Sep 8th, 2013 5 Pages
Broadening Perspective: Managerial Analysis

Ideal Manufacturing Company is a company that is based out of Sycamore, Illinois, which has sustained a company that does research and production of farm related equipment. The company has been manufacturing the farming equipment for a number of years. Ideal Manufacturing has been the single supplier to outside manufacturing companies that are looking to hire research and development companies for special projects. The research and development department happenings have included an overhead cost center that delivers their services to the internal manufacturing departments. In-house the department’s costs have risen to an ultimate high, which has led to Ideal Manufacturing to begin to
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The administration also must re-evaluate and regulate the cost stemming from the research and development department. The administration has resolved to begin using an activity-based costing system in order to define and regulate the cost for both internal and external clients for the research and development department’s services.
The goal of this essay is to perform a managerial analysis in research and development department within the Ideal Manufacturing Company. Within the paper calculations have been made on the activity-based overhead rate for every activity cost pool. To determine what price would be applied to internal industrial sector that expended a specific number of hours for the purpose of market analysis, assuming the sector was provided select designs relating to a fixed number of yields, and required an exact number of engineering examinations. A determination of what price would serve as the foundation for appraising an research and development department proposal with an external corporation on a agreement that would require a specific number of periods for analysis time, necessitate select designs relating to a fixed number yields, and produce a specific number of engineering assessments. The benefits for Ideal Manufacturing should the organization begin using activity-based costing to its research and development department activity for both internal/external billing matters.
It is important for the Ideal Manufacturing

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