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ISSUE IF using traditional ABC IF using Time-Driven ABC How is the Cost of Unused Capacity handled ? This cost is assigned to the products
ISSUE IF using traditional ABC IF using Time-Driven ABC
| How is the Cost of Unused Capacityhandled? | This cost is assigned to the products | |
| How are modifications made to the system to increase granularity? | add more activities (cost pools), requiring a re-surveying of employees | |
| What Time estimates are required? | % of employees total time that is spent on each activity | |
| Which Type(s) of drivers are used (transaction, duration)? | Both can be used but duration drivers are more expensive to measure | |
| How costly is it to build and maintain the system? | Very expensive to build & maintain due to the high level of detail required | |
| What effect does increasing granularity in the system have on the complexity of the system? | Exponential effect |
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Financial And Managerial Accounting
Authors: John J. Wild
9th Edition
1260728773, 9781260728774
