Page 31 - P1 Integrated Workbook STUDENT 2018
P. 31
Activity based costing
2.3 Calculating the full production cost per unit using ABC
There are five steps to calculating an activity based cost.
Identify activities.
Estimate cost pools.
Identify cost drivers.
Calculate cost driver rate = The total in the cost pool divided by the
total of the cost drivers.
Charge overheads to products via cost driver rates.
27
