Activity-Based Costing (ABC) is a cost accounting method that identifies the activities performed by an organization and assigns costs to those activities based on their consumption of resources. The costs are then allocated to products, services, or customers based on their usage of those activities.
A graphic showing a pie chart split unevenly with icons representing "Setups," "Design," and "Machining" vs. a simple pie chart labeled "Traditional Costing."
Activities tied to serving specific clients (e.g., dedicated technical support).
#AccountingLife #FinancialLiteracy #BusinessOwner #CostAccounting #MBA #Strategy
Activity-Based Costing (ABC) is a cost accounting method that identifies the activities performed by an organization and assigns costs to those activities based on their consumption of resources. The costs are then allocated to products, services, or customers based on their usage of those activities.
A graphic showing a pie chart split unevenly with icons representing "Setups," "Design," and "Machining" vs. a simple pie chart labeled "Traditional Costing." activity based cost definition
Activities tied to serving specific clients (e.g., dedicated technical support). Activity-Based Costing (ABC) is a cost accounting method
#AccountingLife #FinancialLiteracy #BusinessOwner #CostAccounting #MBA #Strategy activity based cost definition