Unformatted text preview: different products. While the traditional costing method is designed to focus on financial accounting, ABC system enables companies make internal-decisions easier. Therefore, even though implementing ABC system costs more than traditional costing method, it should be advisable to use this system if the company can make more profits after taking into account the cost of activity base costing system. Applying ABC system to investigate the cost structure for the average job offered by ORS company is more appropriate than using traditional costing method. ABC system is generally effective for non-manufacturing company, whose proportion of the overhead costs is relatively high like ORS company. Using ABC system will improve this accuracy and allow the firm to make better decisions based on more accurate information....
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- Spring '07
- Accounting, traditional costing method