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C213 – Accounting for Decision Makers Competency: 3014.1.3: Cost Systems Topic: Activity-Based-Costing (ABC) 1. Definitions a. Activity-Based-Costing- costing methodology that identifies activities in an organization and assigns the cost of each activi

C213 – Accounting for Decision Makers

Competency:  3014.1.3:  Cost Systems

Topic:  Activity-Based-Costing (ABC)

1.    Definitions

a.    Activity-Based-Costing- costing methodology that identifies activities in an organization and assigns the cost of each activity with the resources to all products and services according to the actual consumption buy each.

b.    Product cost- Costs associated with products or services offered.

c.    Period cost- costs not directly related to a product, service, or asset. They are charged as expenses to the income statement in the period in which they are incurred.

Cost pool- total cost being generated

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