Activity Based Costing: Understanding Costing

What this infographic shows

Activity-Based Costing (ABC) is a costing model that identifies activities in an organisation
and assigns the cost of each activity resource for products and services according to the actual
consumption of each to generate the actual cost of products and services for elimination of
unprofitable and lowering prices of overpriced ones. In a business organisation, the ABC
methodology assigns an organisation's resource costs through activities to the products and
services provided to its customers. ABC enables segmentation based on true profitability and
helps determine customer value more accurately. It is basic towards activity-based
management (ABM). This workshop shows how ABC is applied as supporting business
function, especially in the industrial revolution.