What is Activity-Based Costing?

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Offline fahmidaemran

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What is Activity-Based Costing?
« on: November 11, 2018, 12:38:19 PM »
What is Activity-Based Costing?
Activity-based costingABC is a method for assigning costs to products, services projects, tasks, or acquisitions, based on:

    The activities that go into them
    Resources consumed by these activities

ABC contrasts with traditional costing (cost accounting), which sometimes assigns costs using somewhat arbitrary allocation percentages for overhead or the so-called indirect costs. As a result, ABC and traditional cost accounting can estimate the cost of goods sold and gross margin very differently for individual products. Contradictory and uncertain cost estimates can be a problem when management needs to know exactly which products are profitable and which are selling at a loss.

source: https://www.business-case-analysis.com/activity-based-costing.html
Best Regards,
Fahmida Emran
Lecturer,
Department of Business Administration
Faculty of Business & Economics
Daffodil International University

Offline kamruzzaman.bba

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Re: What is Activity-Based Costing?
« Reply #1 on: March 26, 2019, 03:47:52 PM »
Happy learning
Md. Kamruzzaman Didar
Assistant Professor & Head
Department of Innovation and Entrepreneurship
Faculty of Business & Entrepreneurship