can i get little brief explanation how we can give advice to the question thank you .......

P 145: Email from Suruh Batik I received the following email from a former student. I hope you are doing Iill-ell. I took your Managerial Accounting class ten years ago and have anuestion on how to do costing in a servioe-based business. Cutrentiy. I atu working for a rm that manufactures various prod- ucts ttsed in pipelines itorque wrenches. I'Lange pullers. bolts and anges. grinding machines. etc.i. Five years ago we began servicing pipelines in refineries. ot't'shorefonshore platforms. nuclear plants. etc. Our services thclutie joint integrity. leait sealing. and leak-free bolted con- nections. Uur service technicians go to custoriiers to service their pipelines and charge the cus~ tomers an hourly fee. In servicing, these custonters. our technicians often sell these customers our various manufactured products. The company is organized around functions and not as separate profit centers. Currently. our cost accountlng system onlyr calculates the costs of physical [in-ducts we manu- facture. not the eosi of our servicing side of the business. While WE charge our eustmhers a fee [our our 'rut'itnds sertrlce. ulJr accounting syslcrrt dries. ritil track the acltlul aisles of providing these services nor does it traek the [irislucls our custiahers purchase hecause our teehnleians require these pmdnets to complete their servicing functluns. Rather. the cost of eld technicians is "overhead." and hence our jirofltahility is all over the place. In slack periods. the utilisetimi of 111.11" eld lochnloiuhs is love and our pnilahlilly is low. I.1rl'tilo iri freak periods [he utiliZutitiri of our technicians is high and our overall pnifitnhility rises. We should that we don'tt account for time. and utilization rate of technicians. cost and utlliaation of tools ased. training nails. Management dementia; in it Changing Environment 541 and the revenues of the products sold during. the servicing. These latter revenues are treated as revenues to the entire corporation. not revenues to the servicing end of the business. We don't know the [:rrotitahiiity ol'our servicing business. although we are condent it is very protable. Before jumping to any oonclusions. I would like to know how to proceed about possible changes in our accounting systems and any advice you might oITer regarding how to better evaluate the profitability ofour new {and growing! service business. Thank you for your time. Best Regards Sui'esh Bat iit Required: 1|r'v'hat advicefguidanoe timid you offer Suresh