Activity based costing is an accurate method of cost management that brings detailed information on how to deals with mixing, pricing and outsourcing of products. It doesn’t simply allocates rather it’s a cause and effect process to trace cost. ABC focuses on indirect and handles overhead cost. Because activity-based costing is too much like hard work ,time consuming, costly so complex and yet too much complicated that others may no longer trust on its effectiveness and can be considered as being unreliable. Because of these reasons others think that it’s about time to lay ABC to its rest.
But they did not even think that ABC might have the potential to be back upon the corporate agenda through the help of modern technology, through the use of computers. Web based activity based costing may help in the advancement of activity based costing. Through the aid of computers we can reduce the time, resources and the cost used in actual activity-based costing. Web based activity costing can easily give the managers and other concern personnel the information into what runs costs and profits. Because of these they can decide easily on what strategy to use regarding the price and other factor for the betterment of the company.
Also because of the efficiency and low cost of web based activity-based costing, it is easy to provide the management with more frequent reports to tract unit cost of the activities and resources so that they can improve productivity and minimize the cost. Through this innovation in activity-based costing, managers can make decisions better and faster. And so the company can achieve its peek performance. In the development of technology, many assert that activity-based costing should lie down. But in contrary, the advancement of technology also signals the advancement of activity-based costing, the birth of web based activity-based costing.
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Web based activity-based costing is truly a great improvement in the in industries today because it can reduce the time, complexity and cost of manual activity-based costing. The notion that activity-based costing is hard can now be abolish. Activity-based costing should not be overlooked (Shivers, 2006).
Pierre, S. (2006). Why activity based costing cannot be overlooked. Retrieved August 6, 2007 from http://www. a1articles. com/article_44681_15. html. Shivers, T. (2006). Why Activity Based Costing Cannot Be Overlooked. Retrieved August 7, 2007 from http://searchwarp. com/swa57011. htm.
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