activity based costing

• Activity Based Costing

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Enterprise resource planning Functional areas

1 Budgeting, costing, cost management,

activity based costing


Storyboarding - Business

1 Storyboards also exist in accounting in the ABC System(Activity Based Costing System)

to develop a detailed process flowchart which visually shows all activities and the

relationships among activities. They are used in this way to measure the cost of resources consumed, identify and eliminate non-value-added costs, determine the efficiency and effectiveness of all major activities, and

identity and evaluate new activities that can improve future performance.


Human capital - Risk

1 When human capital is assessed by activity based costing via time

allocations it becomes possible to assess human capital risk


Tax deduction - Cost of goods sold

1 *Methods for attributing common costs, such as factory burden, to particular goods.Among the

methods commonly used are: i) factory burden rate, in which overhead costs are assigned to goods produced based on labor hours or labor

dollars; ii) standard costs, in which a cost including overheads is periodically determined for each type of goods and inventory and cost of goods sold are adjusted periodically for variances of actual costs

from such standards; and iii) activity based costing, in which costs are assigned based on

factors which drive the incurrence of such costs


ERP software - Functional areas

1 * Management accounting: Budgeting, costing, cost management, activity based

costing


IT cost transparency

1 IT cost transparency combines elements of activity based costing, business intelligence, operational

monitoring and performance dashboards. It provides the system

on which to implement ITIL v3|ITIL v3 Financial Management guidelines to

assist with ITSM|Financial Management for IT services and is

closely related to IT Service Management.


Activity-based costing - Historical development

1 Activity based costing, even though originally developed for manufacturing,

may even be a more useful tool for doing this.Sapp, Richard, David Crawford and Steven Rebishcke Article title? Journal of Bank Cost and Management Accounting (Volume 3, Number 2), 1990.Author(s)? Article title? Journal of Bank Cost and Management Accounting (Volume 4,

Number 1), 1991.


Activity-based costing - Application in routine business

1 A report summarizes reasons for implementing ABC as mere unspecific and

mainly for case study purposes[ http://www.meditari.org.za/docs/2007v2/2%20Sartorius,%20Eitzen%20%20Kamala

%20%20art%208%20-%20Vol%2015%20No%202%202007.pdf The design and implementation of Activity Based Costing (ABC): a South African

survey] (in alphabetical order):


Activity-based costing - Public sector usage of ABC

1 Usage in the US Marine Corps started in 1999.[http://www.marines.mil/news/messages/Pages/MARINECORPSACTIVITYBASEDCOSTING%28ABC%29.aspx

MARINE CORPS ACTIVITY BASED COSTING (ABC) ][http://www.cfonet.com/article.cfm/3007694 Activity-

Based Costing (ABC)][http://goliath.ecnext.com/coms2/gi_0198-

49918/SAS-helps-Marine-Corps-budgets.html SAS helps Marine Corps budgets get

lean][http://www.thefreelibrary.com/Energizing+cost+accounting

%3A+Marine+Corps+financial+managers+conduct+a...-a0159963717 Energizing cost accounting: Marine

Corps financial managers conduct a thorough analysis]


Storyboards - Business

1 Storyboards also exist in accounting in the ABC System (Activity Based Costing System) to develop a detailed process flowchart which

visually shows all activities and the relationships among activities. They are used in this way to measure the cost of resources consumed, identify and eliminate non-value-added costs, determine the efficiency and effectiveness of all major activities, and

identity and evaluate new activities that can improve future performance.


Cost of goods sold - Cost of goods made by the business

1 Determining overhead costs often involves making assumptions about what costs should be associated with production activities and what costs should be associated with other

activities. Traditional cost accounting methods attempt to make these assumptions based on past experience and management judgment as to factual relationships. Activity

based costing attempts to allocate costs based on those factors that drive the

business to incur the costs.


Managerial finance - Role of managerial accounting

1 Managers also need to look at how resources are allocated within an organization. They need to know what each activity costs and why.

These questions require managerial accounting techniques such as

activity based costing.


Information audit - Buchanan and Gibb

1 *Account for cost of IR and related services using Activity Based Costing

(Activity-based costing|ABC) and Output Based Specification (OBS).


Cost driver

1 The Activity Based Costing (ABC) approach relates indirect cost to the

activities that drive them to be incurred.


Cost driver

1 Activity Based Costing is based on the belief that activities cause costs

and therefore a link should be established between activities and

product. The cost drivers thus are the link between the activities and the

cost.


Cost object

1 The use of cost objects is very common with activity based

costing systems.


Activity based costing - Application in routine business

1 A report summarizes reasons for implementing ABC as mere unspecific

and mainly for case study purposes[http://www.meditari.org.za/doc

s/2007v2/2%20Sartorius,%20Eitzen%20%20Kamala%20%20art%208%20-

%20Vol%2015%20No%202%202007.pdf The design and implementation of

Activity Based Costing (ABC): a South African survey] (in alphabetical order):


Cost to serve

1 The product and customer profiles are often illustrated using a Pareto

analysis curve which highlights those that contribute most to the

company's profit and those that erode it.Unlike Activity Based Costing (ABC), Cost to Serve is not resource-intensive and focuses on aggregate

analyses around a blend of cost drivers.https://store.theartofservice.com/the-activity-based-costing-toolkit.html

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activity based costing

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