Explain any three features of large - 1 Explain any three...

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1. Explain any three features of large-scale service organizations encourage the application of activity-based approaches to the analysis of cost information. Many large-scale service organisations have two or more of these features and so ABC is indicated in them. In addition, the lack of an existing cost system in many of these organisations means that ABC systems are relatively easy to implement. 1- Indirect costs form a significant part of the cost of an organization 2- There is a strong suspicion of cross-subsidization of products 3- To arrive at a cost of products commensurate with their consumption of activities. 2. Explain any two features of service organisations may create problems for the application of activity-based costing. There are several features of service organisations which may cause problems for ABC installation and analysis: i) Many costs are truly common costs, such as staff with multiple functions.
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