From the course: Activity-Based Costing
Join today to access over 22,600 courses taught by industry experts or purchase this course individually.
Structuring your model
- As you may recall, there are three key steps of activity based costing, cost pools, cost objects, and lastly, activity drivers. Now as you can see, there's quite a logical structure to the design of an ABC. And, it's also logical how we progress through each stage of the process. So given we have invested all this effort in a structured design and methodology, how about we continue this journey in the model itself? I encourage you to follow along with me by having Excel open with the exercise file for this video. As you can see here in the lists worksheet, we have a separate column for each of the ABC steps. That is cost pools, cost objects, and lastly, activity drivers. We can always come back and add items to this list down the track as we make changes to the model. Now if we really want to get fancy, we can apply something called cell validations here, but that's a whole other topic. Okay, there are several ways that we can achieve this next step. But given we're working with a…
Practice while you learn with exercise files
Download the files the instructor uses to teach the course. Follow along and learn by watching, listening and practicing.
Download courses and learn on the go
Watch courses on your mobile device without an internet connection. Download courses using your iOS or Android LinkedIn Learning app.