Question

FedEx
Cost Accounting Project - Identifying Job Costs

Job costs are often the backbone to any process-driven business that relies on costing out common activities to ensure they make a profit. The definition and management of these jobs entail a lot of detail and effort on the owner's part.

For this module's project piece:
• Select three jobs within your chosen business where you need to define the costs associated with those jobs.
• In a 1-2 page paper, describe how you would manage the job process down to the costs.

Cost Accounting Project - Making Decisions

One of the most difficult parts of ownership and management is making decisions. Much of cost accounting relies on the ability to gather the cost detail in an effort to support these difficult decisions from management.

For this module's project piece:
• In a 1-2 page Word document, describe how the cost information that has been created up to this point in the project will help you in the decision making criteria process.

• Be sure to leverage some of the decision making models to develop and describe your own managerial decision making framework for use in your business.

Solution Preview

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The FedEx Company is a courier company, which deals largely in logistic business of delivering goods and parcels from one destination to other. There are many direct and indirect jobs which are performed at every stage of the said business for example, pick up of packets from the sender’s place, delivering the packets and parcels to the receiver’s place, transportation costs, and office staff salaries and so on.

The three jobs within FedEx where there is a need to define the costs associated with these jobs are as follows

1. Delivery – as soon as the packets, letters and parcels reaches the office of FedEx these are sorted as per the address and forwarded to the franchises of the respective destinations. The franchises then deliver the packets, letters and parcels to their respective receivers. The costs associated with delivery are, labour cost for sorting of packets in the main office, transportation cost of sending the packets to the franchises, labour cost of franchises for delivery of the packet to the right recipient of the packet.

2. Pick up – the next cost which is associated to its job is picking up cost of the parcel. The franchise receives the order of pick up, he sends his employee to the place of sender for picking up the parcel, the employee fetches the parcel back to the office, and it is packed, and sent to the head office or hub office for further processing it to the destination. The cost associated with the picking up of parcel consist of – transportation cost of employee for the pickup and back to the office of franchise, packing cost and again the transportation cost of sending the parcel to the hub office of the company.

3. Transportation – the third major job in FedEx is transportation of parcels and packets to and from the sender and hub office. The cost associated which transportation is diesel or petrol, driver and helper’s wages, salary of the employee accompanying the parcel from the sender to the hub office....

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