Bcag Case Study Summary

Case study:-

BCAG is the world’s largest manufacturer of commercial airplanes producing fuselages, noses, struts, nacelles

Any manufacture use activity based costing should achieved five goals: • Should produce more accurate product costing • Control and manage the cost in a better way • better allocation of overheads • the information should be more accurate

The learning outcomes are:

• Maintain currency of technical skills through the application of ABC principles in a timely manner.

• Apply critical thinking through linking these new ideas and evaluating the results to the firm of the system’s implementation.

• Improving of working in teams, written and oral communication skills.

BCAG is the world’s largest manufacturer of commercial airplanes. It forms almost 60%

Phase I activities identified as value added parts of the total fuselage manufacturing process. In addition to the Daily production averaged 30 hoods in the tank line. But in ideal & best conditions, these equipment are created to contain 60 hoods per day.

• The ABCM implementation team calculated that even after normal delays happened such as personnel shift changes or lunch breaks, 54 fully loaded hoods could be pass to the tank line daily. Thus, the current production avrage of 30 hoods daily was only a 55% usage rate of existing equities

• . The ABCM implementation team approximated that by bringing an asset usage up to 100% would mean that BCAG Wichita could bring sort of additional 175,500 outsourced parts back in house. Even if the asset usage level was set at a conservative 80%, also the Division between them could bring 135,000 parts back into the facility.

• To give it an accurate analysis of the impact of bringing 135,000 parts back into the manufacturing plant required the ABCM team to calculate the correct cost of this