Activity Based Costing used in the Organization Activity Based Costing (ABC) is an accounting method used in the business to gather the data of expenses incurred by them. ABC is the modern method of allocating the cost to the department and product as per the activity involved in it (Shaw & Wild, 2012). I am working at Neptouch as a software developer. Neptouch is an IT company where different software’s are developed according to the need of the customer. Although it is an IT company there are different department: Accounting department, IT department, Marketing department, Customer service department, etc. This entire department works under ABC system. Different activities like rent, salary, administrative expenses, maintenance, labor expense, etc are calculated under this system. Here, total costs are broken down into different activities by dividing total expenses so that the expenses of every head can be mentioned easily. For example,
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- Fall '19