ManagerialAccountingStudent财务管理经管.ppt

An activity is any event that causes the consumption of overhead resources. An activity cost pool is a “bucket” in which costs are accumulated that relate to a single activity measure in an ABC system. An activity measure is an allocation base in an activity-based costing system. The term cost driver is also used to refer to an activity measure. The two most common types of activity measures are shown on the next slide. Two types of activity measures include: Transaction drivers – simple counts of the number of times that an activity occurs such as the number of bills sent out to customers. Duration drivers — measures of the amount of time needed to perform an activity such as the time spent preparing individual bills for customers. Traditional cost systems rely exclusively on allocation bases that are driven by the volume of production. ABC defines five levels of activity that largely do not relate to the volume of units produced. In an activity-based cost system, companies typically combine their activities into the following five classifications: Unit-level activities are performed each time a unit is produced. For example, providing power to run processing equipment would be a unit-level activity. Batch-level activities are performed each time a batch is handled or processed, regardless of how many units are in the batch. For example, setting up equipment and shipping customer orders are batch-level activities. Product-level activities relate to specific products and must be carried out regardless of how many batches are run or units are produced or sold. For example, designing or advertising a product would be product-level activities. Customer-level activities relate to specific customers and are not tied to any specific product. For example, sales calls and catalog mailings would be customer-level activities. Organization-sustaining activities are carried out regardless of which customers are served, which products are produced, how many batches