Question

In what fundamental ways does activity-based costing differ from traditional accounting methods, such as job-order costing described in the previous chapter?

Answer 1

Explanation: The difference between activity-based costing and traditional costing is that activity-based costs are typically three-way different than traditional cost-cutting methods, which are as follows: Product costs are separated by both production in nature and non-manufacturing. Distribution is distributed on the basis of the traditional costing system, and the ABC system, however, does not comply. Non-manufacturing costs are classified as production costs based on activity, while traditional costs are calculated as chronological costs.

Activity-based costing is different from traditional spending systems, in many ways. In activity-based costing, non-manufacturing, as well as manufacturing costs, are ranked among the products. Also, most of the production costs are excluded from production costs. Activity-based costing systems typically have a pool of activity costs. These activities are often very different from the allocation cost bases in traditional spending systems.

Answer 2

Activity-based costing differs from traditional costing systems in a number of ways. In activity-based costing, nonmanufacturing as well as manufacturing costs may be assigned to products. And, some manufacturing costs may be excluded from product costs. An activity-based costing system typically include a number of activity cost pools, each of which has its unique measure of activity. These measures of activity often differ from the allocation bases used in traditional costing systems. Final, the activity rate differ from typical predetermined overhead rates in that they should be based on activity at capacity rather than on the budgeted level of activityActivity-based costing differs from traditional costing systems in a number of ways. In activity-based costing, nonmanufacturing as well as manufacturing costs may be assigned to products. And, some manufacturing costs may be excluded from product costs. An activity-based costing system typically include a number of activity cost pools, each of which has its unique measure of activity. These measures of activity often differ from the allocation bases used in traditional costing systems. Final, the activity rate differ from typical predetermined overhead rates in that they should be based on activity at capacity rather than on the budgeted level of activityActivity-based costing differs from traditional costing systems in a number of ways. In activity-based costing, nonmanufacturing as well as manufacturing costs may be assigned to products. And, some manufacturing costs may be excluded from product costs. An activity-based costing system typically include a number of activity cost pools, each of which has its unique measure of activity. These measures of activity often differ from the allocation bases used in traditional costing systems. Final, the activity rate differ from typical predetermined overhead rates in that they should be based on activity at capacity rather than on the budgeted level of activity

Answer 3

Activity-based costing differs from traditional costing systems in a number of ways. In activity-based costing, nonmanufacturing as well as manufacturing costs may be assigned to products. And, some manufacturing costs may be excluded from product costs. An activity-based costing system typically include a number of activity cost pools, each of which has its unique measure of activity. These measures of activity often differ from the allocation bases used in traditional costing systems. Final, the activity rate differ from typical predetermined overhead rates in that they should be based on activity at capacity rather than on the budgeted level of activity