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Explain Activities uses through activities based costing
In order to correctly associate costs with products and services. ABC assigns cost to activities based on their use of resources. It then assign cost to cost objects such as products or customers based on their use of activities. ABC can track the flow of activities in organization through for core areas:
1) Cost object
2) Activities
3) Cost pool
4) Cost drivers
Tom Emory and Jim Morris strolled back to their plant from the administrative offices of Ferguson & Son Manufacturing Company. Tom is manager of the machine shop in the company''s
Characteristics of irrelevant costs
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