Abc Costing — Define

Gather indirect costs and group them by the activity they support.

Activity-Based Costing (ABC) is a managerial accounting method that assigns costs to products, services, or activities based on the consumption of resources. It is a more refined and accurate approach to cost allocation compared to traditional costing methods, which often lead to distorted cost information. ABC provides a more detailed and realistic picture of an organization's cost structure, enabling better decision-making and cost management. define abc costing

The ABC process follows a logical flow, often described as a "two-stage" allocation process: Gather indirect costs and group them by the

It operates on two foundational principles: define abc costing