--%>

Activity-based costing

 

A method of assigning overhead costs to products. The first step is to analyze the cost of various activities. This approach looks like at activities (such as changing specifications for a digital painting machine or the cost of processing customer orders) as distinct parts of drudgery. These activities are then identified as cost drivers. Activity-based costing uses cost drivers to assign overhead costs to product or services. Traditionally, manufacturing companies have used the bulk number of direct labor hours as the method of allocating overhead. Activity-based revenue compels manufacturing companies to analysis what is contributing acquired surplus 20 to the price of the product beyond the usual labor and materials 

 

 

   Related Questions in Managerial Accounting

  • Q : Blackout period A defined time period

    A defined time period in accounting for stock options. In the mean while the blackout period person granted the option is not allowed to exercise it. This usually occurs after the granting of the stock options and allows the price of the stock to increase above the exercise price.  <

  • Q : Avoidable interest The amount of

      The amount of interest that an organization would have avoided if it had not made the expenditures for an asset. Avoidable interest is calculated when an entity is self- constructing an asset. The cost of the asset can include material, labor, and overhead plus some interest. The c

  • Q : What is Corporate Tax Corporate Tax :

    Corporate Tax: It is a levy placed on the gain of a firm, with different rates employed for various levels of gains. Corporate taxes are the taxes against profits earned by businesses throughout a given taxable period; they are usually applied to comp

  • Q : Ravenna Please see attached. Do tutors

    Please see attached. Do tutors provide assistance as to how they came about their answers?

  • Q : Factors due to changing business

    What are the various factors which occurred due to the changing business landscape?

  • Q : Determine & Analysis on Income

    The DU Inn The DU Inn is an 80-room hotel located on some mountaintop in Colorado. That has no bar or restaurant &is positioned as a mid-priced, good quality "homey" hotel.  It is open only during

  • Q : Define the term Strategic management

    Briefly define the term Strategic management and also state the reason why it is designed?

  • Q : Analysis on Business Profile BUSINESS

    BUSINESS PROFILES:Go to the following webpage by clicking on the link or by copying and pasting the URL into your web browser:After opening the link, you will see a small cover page of the West Newsmagazine’s publication titled “Business Profiles&rdq

  • Q : Define Capital Budgets Capital Budgets

    Capital Budgets: The procedure of finding out which potential long-term projects are value undertaking, by comparing their estimated discounted cash flows with their internal rates of return. Capital Budget is the

  • Q : Why wealth creation is a longer-term

    Write a short note on why wealth creation is a longer-term concept?