Management Accounting

Dakota Office Products

Submitted by: Divya Panjwani PGP12075

Case Overview:
Dakota Office Products (DOP) is a merchandising company run by John Malone, the General
Manager. DOP is a regional office supply wholesaler for institutions and commercial
organizations. In 1999, the corporation launched the Electronic Data Interchange (EDI)
system, followed by a new Internet site in 2000. This is to make it easier for customers to
place orders and have things delivered. The introduction of electronic services was expected
to boost the company's profit margin, however despite higher sales, the actual financial result
of operations for the year 2000 was a Net Loss.

Problem Statement:
What caused the loss of the company for the financial year 2000 and what actions must
Does it employ to gain back its profitability?

Objectives
• To be able to understand the company’s current situation and be able to point out possible
reasons for the company’s net loss for the year
• To be able to recommend actions to aid DOP to gain back its profitability
• To be able to recognize the relationship between cost management and customer
profitability to proper pricing
• To appreciate ABC costing in a non-manufacturing company like DOP