Faeyee: allocation of constrained business resources for production of competitive products from cost accounting perspectives

Abstract

Synopsis

Faeyee Electronics was an electronics company that manufactured and sold smartphones including XS and XT types. The management of Faeyee wanted to pursue the maximum contribution margin as much as possible, especially since they were faced with limited resources. It was necessary to apply analytical tools and cost accounting concepts to study this case including cost-volume-profit analysis, learning curve analysis, regression analysis, definitions of competitive products, constrained non-linear optimization, and contribution margin.

Research methodology

The case uses business analytics tools and cost accounting concepts, including regression models and constrained optimization approaches, to study how to maximize business outcomes, such as contribution margin and profits when limited business resources are available. The company and individuals are disguised.

Relevant courses and levels

This case can be used in any junior-, senior-, masters- or MBA-level managerial accounting course. Students need to have at least one course of introduction to statistics or instructors review required statistics concepts or techniques before assigning this case. Students are exposed to the challenges of deriving learning curve models, using regression analysis to study collected data and allocating limited resources to maximize contribution margin.

Citation

Li, J. and Wu, D. (2017), "Faeyee: allocation of constrained business resources for production of competitive products from cost accounting perspectives", , Vol. 13 No. 6, pp. 704-728. https://doi.org/10.1108/TCJ-09-2016-0075