8-1 Activity-based costing differs from tradi-
ity—whether utilized or not—are spread across
tional costing systems in a number of ways. In
the budgeted production. Since the costs of ca-
activity-based costing, nonmanufacturing as well
pacity are largely fixed, this results in higher unit
product costs when the level of activity declines.
as manufacturing costs may be assigned to prod-
If an overhead rate is based on the level
ucts. And, some manufacturing costs may be ex-
of activity at capacity, a product is charged only
cluded from product costs. An activity-based cost-
ing system typically includes a number of activity
for the costs of capacity that it actually uses. The
costs of unused capacity are not charged to prod-
cost pools, each of which has its unique measure
of activity. These measures of activity often differ
ucts and are instead charged to the current pe-
riod as expenses of the period (see Appendix 3A).
from the allocation bases used in traditional cost-
ing systems. Finally, the activity rates differ from
As a result, unit product costs are more stable
typical predetermined overhead rates in that they
and costs do not appear to increase as the level
should be based on activity at capacity rather
of budgeted activity decreases.
than on the budgeted level of activity.
Bạn đang xem 8- - SOLUTIONS TO QUESTION MANAGERIAL ACCOUNTING CH08 ACTIVITY BASED COSTING