Finally, you should reflect on the results of your activity$-$based

costing exercise, by:

a$)$ explaining how costs are categorised.

b$)$ identifying those cost areas that have the greatest impact

on the profitability of the product that you have investigated.

c$)$ evaluating the reasons for producing an activity$-$based cost

model.

d$)$ explain how ABC model used to improve profitability.

Checklist of evidence

required

A research and problem solving project to explore the costs associated

with engineering activities and to complete an activity$-$based cost model

for a product.