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Unformatted text preview: o ?? Activity-Based Costing-Two Stage Procedure
Costs Overhead Costs
Costs First-Stage Allocation
ﬁgure out cost poll and cost driver Customer
Relations Other SecondSecond-Stage Allocations
$/Order $/Design $/MH $/Customer
per unit amount Cost Objects:
Products, Customer Orders, Customers Unallocated Steps
Steps in designing ABC systems Identify activities that consume resources.
Assign resource costs to activity cost pools.
Identify cost drivers for each cost pool.
cost drivers for each cost pool
Compute overhead rate for each cost pool:
Rate = Estimated overhead costs in activity cost pool
Estimated number of activity units Assign costs to products or cost objects:
! Activity Activity-Based Costing
4 Comparison of Traditional and
Activity-Based Systems Calculate the activity rate for each activity cost driver.
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This document was uploaded on 03/13/2014 for the course RSM RSM222 at University of Toronto.
- Fall '13