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Activity cost pools are the accumulation of all overhead costs involved in the processing of each activity cost driver.
* attribute staff salaries and other costs to activity cost pools,
The purpose of the flowcharts was to determine whether there were any other expenditures, such as computing and database costs, which also needed to be captured in the activity cost pools.
Once key activities have been identified, the next step is to apportion library costs to the activity cost pools. The first step in this process is to determine the proportion of time library employees spend on each activity so that their salary costs can be allocated accordingly.
The activity base for each activity cost pool is computed by multiplying the anticipated production of the three products by the number of parts required for each product.
A factor used to assign cost from an activity center to other activity cost pools or cost objects.
* From a center account cost pool to other center cost pools, accounts, activity cost pools, or cost objects.
The bank's ABC team created separate activity cost pools for the costs associated with each of the three activities: (1) paying checks, (2) providing teller services, and (3) responding to customer account inquiries.
(6.) We have also modified the case by adding additional activities (such as ATM transactions and processing returned checks), and by adding additional cost line items to Exhibit B that require students to split the cost across activity cost pools. For example, salaries of check-processing personnel might be split across the "paying checks" activity and a new activity for processing returned checks.
Using the information in the first three phases, an ABC model is developed which is used to drive the activity cost pools to each output.