Activity-Based Costing in the Info Age, Part I

Despite the fact that it is over 75 years old, most companies still use standard cost systems both to value inventory for financial statement purposes and for many other management purposes as well. While it has some advantages for financial statement purposes (simplicity, consistency, well understood by auditors), it is, at best, meaningless and, at worst, misleading as a tool to assist in making effective management decisions.

Editor’s Note: an excellent look at ABC for the uninitiated; find Part II at
James D. Tarr
Source: “BetterManagement.com”
Subjects: Accounting, Finance

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