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Report on Activity Based Costing and Traditional Method

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Added on  2020-05-11

Report on Activity Based Costing and Traditional Method

   Added on 2020-05-11

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AYB225 ASSIGNMENT PART C Discussion:From the schedule 6, it has been found that the traditional system is far different from the ABC costing method. Traditional costing method takes the concern of various unreverent aspects whereas ABC costing system undertakes all the required factors and makes a decision accordingly. According to the given analysis, it has been found that the traditional costing system understates the entire expenses collectively whereas the activity based costing system manages the entire cost of the comapny differently and then analyse the cost of the company. According to the traditional costing method of the comapny, the total overhead of the comapny is $ 28,125, $ 15,625 and $ 15,750 respectively for Dance, run and walk. At the same time, it has been found that the total allocated cost according to the activity basedcosting is $ 25,469.4, $ 13,408.8 and $ 20,622.23 respectively for the Dance, run and walk. This depicts that various differences are there in the total outcome of the total overhead of the comapny according to the traditional costing method and activity based costing. Through these reports, it has been analysed that the following differences are thereamong the activity based costing and traditional method. Page 1
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