In this module, we are going to review your organization and its applicability for Activity Based Costing (ABC).
Identify a product or service in your organization that could use ABC. You can also use this technique for selling and administrative costs. Then identify at least two activities for ABC and the appropriate cost drivers for those activities. Estimate the application rates for each cost driver.
If you cannot identify specific actual amounts, make a reasonable estimate and apply the tool as if the data were factual.
Your report should include
? The name and nature of the organization
? The activity and time period you used
? The inputs you used
? Your results
? Any implications from your results
For the purpose of Activity Based Costing analysis we have selected Wal-Mart as organization. Wal-Mart was founded in 1962 and currently has more than 8,000 retail units in 15 different countries. The company has a employee base of more than 2.1 million worldwide.
Attached is the detailed answer.