Answer Respond To Below In Your Own 200 Words In Its Adverti
Answer Respond To Below In Your Own 200 Wordsin Its Advertising Ford
Answer. respond to below in your own 200 words In its advertising, Ford Motor Company says "Quality is Job One." Ford is indicating that good quality is the most important consideration for its customers. This would include customer satisfaction on delivery dates and specific areas of car performance, including properly closing doors, and defect rates. Explain how Activity Based Costing can help supply this information to Ford's management.
Paper For Above instruction
Activity-Based Costing (ABC) is a vital managerial accounting tool that provides detailed insights into the true costs associated with producing and delivering products, thereby enabling companies like Ford to enhance product quality in alignment with their "Quality is Job One" commitment. Traditional costing methods often allocate overhead based on broad averages, which can obscure the actual costs linked to specific activities influencing quality, such as inspections, repairs, and manufacturing checks. ABC overcomes this by assigning costs to activities based on their actual use of resources, which allows Ford's management to precisely identify the costs associated with quality-related processes.
By implementing ABC, Ford can track costs incurred in activities such as quality inspections, defect corrections, and supplier quality control. This detailed costing helps management analyze which activities are driving costs and affecting quality performance, directly linking expenditures to specific quality outcomes. Consequently, Ford can identify high-cost activities that may need improvement or elimination, leading to better resource allocation focused on quality enhancement. This transparency aids in decision-making, ensuring investments are directed toward areas that improve customer satisfaction, meet delivery schedules, and reduce defect rates—ultimately supporting Ford's promise of quality as its top priority.