Conditional Resources in ABC

Activity Based Costing
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Best Practices
Mark, UK

Conditional Resources in ABC

How does ABC cater for estimating the cost of business processes which may take many different routes depending on the outcome of decisions or events - for instance, a resource may only be used once in every hundred runs of the process, therefore is only 1% of the resource cost included in the estimate??

  Charles, UK
 

Conditional Resources

Most ABC/M models are built using real transactional or operational metrics extracted from the business OLTP systems as the basis for assignment. So if the data indicates that the resource was used 99% of the time for process A, and only 1% for process B, the model should reflect this.

 

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