Question

For this assignment, consider the research and analysis from prior assignments and apply the "Conceptual Framework for Managerial Costing," as discussed in the topic materials. Follow the process outlined in the "Where to Start" section of this topic resource. Assume Apple Inc is considering making a change, such as adding a new product or entering new markets. Your task is to determine what the "change" could be and the steps that would need to be taken in the decision-making process.

In a 700 word memo to the chief operating officer (COO) of Apple Inc, address the following.

1. Summarize the proposed change Apple Inc is considering.
2. Discuss the specific information that must be collected to perform the analysis on the proposed change.
3. Discuss the scope of the analysis and what parameters will be used to determine whether the proposed change should be made.

Answer 1

The purpose of the conceptual framework is to improve managerial costing by providing a structure to objectively evaluate various approaches to costing and apply them to internal decision support, i.e., to improve the operational optimization decisions made by managers and employees.

A useful cost model must efficiently:

• Take a manager from a monetary effect to an operational cause and

• Provide the manager with clear and direct insight into the monetary effect of a particular operational action (cause) being considered.

Understanding the Connection to Strategy and Strategy Execution

Managerial costing supports the achievement of an organization’s strategic objectives and the optimization of its operations. The managerial costing practitioner must evaluate, understand, and incorporate the organization’s strategy and operations into the design and implementation of an effective managerial cost model and then apply the resulting decision-support information effectively.

Where to Start

Current operations serve as the foundation for optimization activities. An organization’s current investments (resources deployed), value chain, products/services, market segments, and customers equate to the status quo, and collectively they are what managers use to achieve strategic objectives.

Whenever change is considered, managers use current operations as the baseline in their decision making. In evaluating decision alternatives, managers’ best guidance for future outcomes is often provided by understanding the cause-and-effect relationships in the conversion process they are attempting to influence and improve.

Enterprise Optimization: Context, Aim, And Scope

The design of a managerial cost model begins with understanding the organization’s strategic managerial objectives. It’s important to consider the context, aim, and scope associated with the organization and its strategy. Management accountants will need to make appropriate choices and trade-offs among the framework’s concepts and constraints to find the correct balance and focus for their particular organization.

The model design must enable optimization decisions by incorporating the industry environment, competitive situation, and the company’s own current conditions and disposition. These aspects comprise the company’s optimization context, which determines the nature and frequency of the types of decisions its managers will make

Yes,Proposed change should be made.