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Case Study Activity Based Costing Isle of Arran Distillers 1. Calculate throughput based on the standard TOC and carefully comment on your findings. Explain why

Case Study Activity Based Costing "Isle of Arran Distillers"

1. Calculate throughput based on the standard TOC and carefully comment on your findings. Explain why pricing discretion based on throughput arguments is to be reserved for special (short-term decision) orders only.

2. Calculate the ABC production-only cost per liter for each of the three products Arran Malt, Loch Ranza and Holy Isle.

3. Integrate the full ABC and TOC analysis into a cost system that provides you with the following information:

  • - net throughput per liter;

  • - variable cost per gallon;

  • - (integrated) ABC cost per gallon.

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