Activity Based Costing Methods

Activity Based Costing Methods

In a 4-5 page paper, discuss the following:

• The importance of cost pools and drivers and their application in the ABC method.
• Give an example of activity-based costing methods by creating a fictitious company. Include a cost analysis.
• Discuss the 2-3 advantages of the ABC method.
• Be sure that the paper has no spelling or grammatical errors.

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Introduction

Different organizations have different accounting methods used in their firms to prepare accounting reports. These accounting methods are important in calculating expenses, loses and profitability to keep the business in check and to ensure they achieve their objectives and compete fairly with other organizations. One of the costing methods discussed below is the Activity-Based Costing commonly referred to as the ABC.

Activity-Based Costing

This is an accounting method that defines the costs, activities and the products of a firm. It recognizes their relationship and seeks to assign indirect costs of a product. This accounting method is commonly used in manufacturing…..

APA

1163 words