Abc and Abp&b
Romeo G. Manalo, Management Consultant, Philippines, Member
Abc information is ideal for activity-based planning and budgeting. All you need to do is to quantify the forecasted customer demands into activities and activity drivers. Since the activity unit costs are already available either through the previous year's ABC information or standard activity measures and costs, simply convert the demands to activities and multiply the activity demands by the costs, then the budget can be generated which is linked to the demands (plan).
The only limitation of this method is that if the ABC information which include the activity drivers and activity unit costs are questionable to those who are preparing the budgets and plans.