GACT5113: Due to rising labour costs in Malaysia, Domain Computer, based in Singapore, is considering shifting part of its production facilities: Managerial Accounting Assignment, UTAR, Malaysia
| University | Universiti Tunku Abdul Rahman (UTAR) |
| Subject | GACT5113: Managerial Accounting |
Due to rising labour costs in Malaysia, Domain Computer, based in Singapore, is considering shifting part of its production facilities from Malaysia to an emerging market, Vietnam, to better integrate its supply chain in the Southeast Asia region.
John Lawson, the CFO of the company, estimates that Domain Computer needs to invest USD 735,000 to acquire an existing factory in Vietnam and another USD285,000 in renovations and installation of new machinery. The cost of training new workers is estimated to be USD310,000. He believes that the new factory will lead to estimated USD928,000 savings in labor costs and another USD417,000 savings in logistics expenses.
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