Read Nikes 10-K in Appendix C. Item 1 describes its business, especially in the United States. A
Question:
Read Nike’s 10-K in Appendix C. Item 1 describes its business, especially in the United States.
A simplified description of Nike’s supply chain follows:
1. What kind of production system and associated costing system would you expect at the contract manufacturers? Nike distribution centers? How many distribution centers does Nike operate in the United States? Where are they located? How many retail accounts are in the United States?
2. Suppose Nike is implementing an ABC system to improve its accounting for overhead costs at its Memphis facility. Some of the activities performed at a Nike distribution center are listed below, along with a resource used by each activity. Because each of the resources is also used by more than one activity, its cost must be allocated. For each of the activities-resource pairs, suggest a plausible cost-allocation base that could be used to allocate the resource cost to the activities.
Activities ………………………………………………………………………. Resource Used
Receiving, put away apparel, picking products to fill an order, loading
pallets onto trucks for shipment …………………….. ……Forklift
Receiving, put away apparel, repacking in boxes, repacking in cartons,
shipping ……………………………………….. ……Occupancy costs
Supplies ordering, customer order processing, invoicing and payment for
parcel deliveries ………………………………… Variable computer costs
Step by Step Answer:
Introduction to Management Accounting
ISBN: 978-0133058789
16th edition
Authors: Charles Horngren, Gary Sundem, Jeff Schatzberg, Dave Burgsta