OBJCHP8_08 - COST AND MANAGEMENT ACCOUNTING 1 UNIT 3 : (...

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COST AND MANAGEMENT ACCOUNTING 1 UNIT 3 : ( CHAPTER 8) - Systems Design: Activity Based Costing LEARNING OUTCOMES : 1. List the limitations of traditional costing systems (see chapter highlights) 2. Explain how an ABC system overcomes the limitation described in the previous learning outcome. 3. Describe Activity-based costing (ABC) and list the 5 ways it differs from traditional costing . Define activity, activity cost pool, activity measures (allocation base), activity rates . (see chapter highlights) 4. State how companies integrate ABC systems with their accounting system. State which cost items typically need little adjustment when switching to an ABC system. 5. List the seven steps for implementing an ABC system. (see chapter highlights) 6. Define and give and example of each of the 5 types of levels of activities that make up the various activity cost pools. Also, give an example of the activity measures for each type. (see chapter highlights) Ex 8-1, 8-2, 8-3 7. Review and understand the example in the book of how these 7 steps are implemented in a practical
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