Session Syllabus
EMBA 512 – Assessing Business Opportunities
Session Session Session
Date
#
Time
Thurs.
Nov. 15,
10
AM
2012
Primary Instructor Name
Frank Ilett
Session Title
Instructor(s)
Internal Performance Measurement:
ABC Costing and Transfer Pricing Module
Frank Ilett
Phone
208.426.2568
Email
[email protected]
Learning Objective:
Activity Based Costing (ABC):
Activity Based Costing (ABC) is an alternative way of assigning costs to products or cost
objectives. It focuses on the way in which each objective uses the various overhead pools
versus the traditional approach that uses a single overhead driver. ABC costing applies to
manufacturing, service industries and governmental units alike. The manner in which
costs are allocated can have a significant impact on the way managers evaluate operating
results. This portion of the course will acquaint students with implementing systems,
using and interpreting cost information in an ABC environment.
Transfer Pricing:
Most enterprises have the opportunity to sell their products or services to other members
of their corporate family. This requires establishing an interdivision pricing structure that
is fair and equitable to all parties. This issue is complicated even more where it involves
divisions that reside in different nations that have varying taxing structures. In this
portion of the module, students will be acquainted with transfer pricing methods and their
impact on performance measurement.
Advanced Preparation:
Reading(s): Accounting for Decision Making and Control, 7th edition, Jerold
Zimmerman.
 Chapter 5
 Chapter 11
Day of Session:
Assignment(s): None!
Post Session:
Assignment(s):
Assign. Description
Date
#
Due
10.0
10.1
Transfer Pricing
Case Analysis
ABC Cost
Case Analysis
Time
Due
Submittal Individual Grading
Method
/ Group Instructor
Points
Assign.
Weight
11-27-11
5:00 (PM)
Email
Individual
Ilett
50
n/a
11-27-11
5:00 (PM)
Email
Individual
Ilett
50
n/a
Assignment Details:
Assignment 10.0
- Problem 5-3 from the text. Each student needs to prepare an analysis using excel and
write a paragraph explaining the conclusions they reached based on the calculations.
- Problem 5-9 from the text. Using the information in the problem determine a
possible equitable transfer price based on the information provided. Write a short
paragraph explaining your conclusions.
Assignment 10.1
- Problem 11-9 from the text. Prepare a worksheet that reflects the operating income
statements of the departments using the ABC approach. Prepare a short memo to me
explaining why this method is better than the traditional method. Also, address any
pit falls you may see.

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