Southern New Hampshire University
Module Three Homework
Respond with short answers in paragraph form.
1) What are the various methods that can be used to analyze distribution costs?
To analyze distribution cost the methods are cost benefit analysis, source consumption, activity based costing and total aggregate costing.
2) Why is it important for the controller to keep track of distribution costs? Controllers keep track of distribution costs to watch changes un the cost of a product. Some questions need to be asked and answered, is there a decrease in cost or does the cost to create the product increase? The controller must see these trends to give future guidelines in budgeting for the product.
3) What steps might a controller take if the distribution costs of a certain product exceed the actual price the customer was being charged? What a consumer pays are what makes the product either successful or a failure. A controller in this position would cut what is spent in distribution cost and increase costs in the production of the product.
4) What is meant by the term "standards" in the context of distribution costs? In distribution costs context the standards are costs that are set forth by the sales divided by the marketing used before distribution of the product.
5) Why is it important to set distribution standards? Distribution standards set the protocol for what is needed to make a successful product.
6) Once a company has decided to set certain standards, they must maintain and record different types of information. Please discuss the type of information that must be kept track of. Why is this information useful? Information from the mundane to the valuable need to be kept track of. Good record keeping will give the means and the information for a company to protect itself and its assets. Performance and profit analysis through time can be shown to increase or decrease based on the records. Record keeping can limit the risks a company may face. Bank accounts, statements