Activity Based Costing Flashcards
1
Q
Cost Per Unit of the cost driver
A
Total Cost of the activity / Total units of the cost driver
2
Q
Step 1 ABC
A
identify and classify the activities involved in the production process
3
Q
Step 2 ABC
A
Determine the cost of driver for each activity
4
Q
Step 3 ABC
A
Calculate the cost per unit of the cost driver for each activity and allocate the costs to the products or services based on the amount of the cost driver used.
5
Q
Activity Based Costing
A
Activity-based costing (ABC) is a costing method used to allocate indirect costs to products or services based on the activities that drive these costs.
