Textbook Notes (363,559)
Canada (158,426)
Accounting (242)
ACCT 2230 (113)
Chapter 5

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University of Guelph
ACCT 2230
Elliot Currie

Chapter 5 - Study Summary Notes Activity Based Costing Implementation Process: 1. Identify & Define Activities, Activity Cost Pools, & Activity Measures -types of activities: Unit-level- performed each time a units produced; cost should be proportional to number of units produced (providing power to run processing equipment) Batch-level- performed each time batch is handled or processed, regardless of number of units in a batch; costs depend on number of batches and are only incurred once per batch (placing purchase orders, setting up equipment, arranging shipments) Product Level-relate to specific products, regardless of number of units or batches produced/sold (designing product, advertising product, maintaining product manager and staff) Customer-Level-relates to specific customers (sales, general tech support, cataloguemailings) Organizational-Sustaining- heating factory, providing computer network arranging loans, annual reports to shareholders, cleaning executive offices Activity Cost Pool Activity Measure Customer Orders Number of customer orders Product Designing Number of product designs
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