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ABC costing

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › ABC costing

  • This topic has 3 replies, 2 voices, and was last updated 3 years ago by AvatarJohn Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
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  • November 4, 2022 at 6:53 am #670631
    AvatarJames124
    Participant
    • Topics: 166
    • Replies: 138
    • ☆☆☆

    Can we say that “after ABC costing many fixed cost turn into variable to the number of activities it is done.”

    For example fixed OH is broken to Delivery OH etc. So now after ABC we will charge it as Cost per delivery as number of delivery is our cost driver.

    Am I right?

    November 4, 2022 at 8:51 am #670653
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54845
    • ☆☆☆☆☆

    You cannot say that. The costs themselves do not become variable – they remain fixed costs.

    It is simply that we are choosing to absorb the fixed costs in the most sensible way for the purposes of getting a realistic cost per unit when more than one product is being produced.

    November 5, 2022 at 6:47 am #670692
    AvatarJames124
    Participant
    • Topics: 166
    • Replies: 138
    • ☆☆☆

    Thank you 🙂

    November 5, 2022 at 8:38 am #670700
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54845
    • ☆☆☆☆☆

    You are welcome 🙂

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    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘ABC costing’ is closed to new replies.

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