Many costs in the organization remain unrecognized by our cost system. One example given by Norm Raffish in his article is that of inter-cost.

Required:

1.Considering the characteristics of inter-cost and how they occur, can you identify other costs that remain poorly recognized by the cost system?

2.Will any modification of the cost system allow a better recognition of these costs? Explain.

3.Specifically, will Activity based Cost system recognize these costs better? Why or why not.

4.Will any changes in organizational structure help in better recognition of these costs? Why or why not?