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The Indian Journal of Commerce Vol 52, No. 4, October December 1999 Activity Based Costing in Printing Industry Profitability Enhancement Through Realistic Pricing B Ramesh and Y.V. Reddy. Activity
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How to fill out activity based costing in
How to fill out activity based costing in:
01
Identify and list all the activities within your organization that consume resources.
02
Determine the cost drivers for each activity, which are the factors that cause the activity to consume resources.
03
Calculate the cost rates for each activity by dividing the total cost of the activity by the total quantity of the cost driver.
04
Assign the cost of each activity to the products or services that utilize the activity, based on the quantity of the cost driver used by each product or service.
05
Finally, allocate the overhead costs that cannot be directly assigned to specific activities or products using a predetermined allocation method.
Who needs activity based costing in:
01
Manufacturing companies: Activity based costing is especially beneficial for manufacturing companies that have complex production processes with multiple activities involved. It helps them accurately determine the cost of each product, which is crucial for making informed pricing decisions.
02
Service industries: Service-oriented businesses can also benefit from activity based costing as they often have diverse activities that contribute to the overall cost of delivering services. It allows them to understand which services are more profitable and identify areas where costs can be reduced.
03
Organizations with high overhead costs: Activity based costing is particularly useful for organizations with significant overhead costs, such as administrative expenses or support functions. It helps in allocating these costs more accurately, ensuring fair distribution among different activities or products.
Overall, activity based costing is a valuable tool for organizations looking to improve cost allocation, enhance pricing decisions, and gain a better understanding of their cost structure.
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What is activity based costing in?
Activity based costing is a costing method that identifies activities in an organization and assigns the cost of each activity to all products and services according to the actual consumption of resources.
Who is required to file activity based costing in?
Any organization that wants to accurately determine the true cost of production for its products or services may choose to use activity based costing.
How to fill out activity based costing in?
To fill out activity based costing, you need to identify all the activities involved in the production process, determine the cost of each activity, and then allocate those costs to the different products or services.
What is the purpose of activity based costing in?
The purpose of activity based costing is to provide more accurate information on the costs associated with producing products or services, helping organizations make better decisions.
What information must be reported on activity based costing in?
Information such as the cost of activities, allocation of costs to products or services, and insights into resource consumption are typically reported on activity based costing.
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