A. Activity-based:
While activity-based costing provides a more accurate allocation of indirect costs than traditional methods, it doesn't specifically focus on the logistics-related costs associated with transportation, storage, and delivery. It's more concerned with identifying the costs associated with different activities within a company
ABC assigns costs to specific logistics activities (e.g., warehousing, transportation, order
processing) rather than spreading costs evenly across all products
The costing approach that directly reflects logistics performance is B. Total landed.
Explanation:
Total landed cost encompasses all the expenses incurred in acquiring a product and delivering it to the customer's final destination. This includes not only the purchase price of the goods but also transportation, customs duties, warehousing, insurance, and other related charges. By considering all these costs, total landed cost provides a comprehensive view of the actual cost of getting a product to market. This is crucial for evaluating logistics efficiency and effectiveness, as it allows companies to identify areas for improvement and optimize their supply chain.
Explanation: Total landed cost encompasses all the costs associated with getting a product from the point of origin to the customer's door, including transportation, customs duties, insurance, warehousing, and any other related fees. This provides a comprehensive view of the total cost involved in delivering a product, making it a good indicator of logistics performance.
The correct answer is " B" - Total Landed Cost
The costing approach that directly reflects logistics performance is "Total landed cost".
Explanation:
Total landed cost: takes into account all the costs associated with getting a product from the point of origin to the customer's door, including transportation, customs duties, insurance, warehousing, and any other related fees. This comprehensive approach allows for a clear picture of the overall logistics performance and identifies areas for potential cost reduction.
today’s leading supply chain companies
develop functional cost analyses and activity-based costing activities
that measure the total cost of logistics.( Words in module 5)
I believe the question is referring to the total logistics costs which would include total landed costs in addition to several other services available through logistics providers.
Landed costs are usually taken under consideration to evaluate logistics
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