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If a manufacturing company is using activity based costing for internal purposes only then organization sustaining overhead costs should not be allocated to any of the products true or false?
Wiki User
∙ 13y ago
True
Wiki User
∙ 13y ago
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What is the differences between activity-based costing and traditional product costs?
In traditional costing, overheads are allocated using blanket rate while in activity based costing overheads are allocated by the activities performed.
What type of cost should not be assigned to products in an activity-based costing system?
Organization-sustaining costs, customer-level costs, and the costs of idle capacity should not be assigned to products. These costs represent resources that are not consumed by the products.
How can activity-based costing be used in non-manufacturing industries?
Yes, you can.
Who develop activity based costing?
Activity-based management and activity-based costing (ABM/ABC) have brought about radical change in cost management systems. ABM has grown largely out of the work of the Texas-based Consortium for Advanced Manufacturing-International (CAM-I). No longer is ABM's applicability limited to manufacturing organisations. The principles and philosophies of activity-based thinking apply equally to service companies, government agencies and process industries. The acronym itself has evolved from ABC to ABCM (activity-based cost management) to ABM, and the application of ABC evolved from a manufacturing product costing orientation to a management philosophy of activity management applied in industries and organisations other than manufacturing.
A well-designed activity-based costing system starts with?
assigning manufacturing overhead costs for each activity cost pool to products
What is an example of a service-sustaining activity?
A product-sustaining activity supports an individual product or product line, such as product (re)design or (re)engineering. These last two types of activities are sometimes referred to as service-sustaining activities.
What is an example of a facility sustaining activity?
a facility-sustaining activity supports an entire facility, such as the actions of the manager of an entire plant, with an associated cost equal to the manager's compensation package.
What is an example of a facility-sustaining activity?
a facility-sustaining activity supports an entire facility, such as the actions of the manager of an entire plant, with an associated cost equal to the manager's compensation package.
What is the differences between activity-based costing and traditional product costs?
In traditional costing, overheads are allocated using blanket rate while in activity based costing overheads are allocated by the activities performed.
While sustaining a contraction of Biceps why do Triceps EMG activity increase?
uh huh
What does the level of activity in an organization depend on?
The level of an activity within an organization depends on the level of operations supported by that activity.
What document defines military manpower authorizations allocated to a naval activity?
AMD
Which document defines military manpower authorizations allocated to naval activity?
AMD
Which document defines military manpower authorizations allocated to a naval activity.?
AMD
What type of cost should not be assigned to products in an activity-based costing system?
Organization-sustaining costs, customer-level costs, and the costs of idle capacity should not be assigned to products. These costs represent resources that are not consumed by the products.
What is Vermont's chief economy activity?
manufacturing
What is quebec's economic activity?
Copper and manufacturing.
