Activity based costing is a costing method that has been developed to deal with the perceived weaknesses of traditional absorption costing.
Traditional absorption costing is based on the principal that production overheads are driven by the level of production. This is reflected in the choice of...
Activity-based costing (ABC) is a costing methodology that identifies activities in an organization and assigns the cost of each activity with resources to all products and services according to the actual consumption by each. This model assigns more indirect costs (overhead) into direct costs...