ABC Costing in Make to Order of Repetive Manufacturing




Activity Based Costing
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Zaheer, India

ABC Costing in Make to Order of Repetive Manufacturing

I think ABC costing works better only in repetitive manufacturing type of industry, where the amount of production in a given period is steady.
Whereas in a make to order environment ABC may not work well, because the profit and expenditure have to be tracked by order. One order may last for several perods.
 
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Jim Monahan
Business Consultant, United States
 

ABC can Work in Make to Order Production

It seems you are getting too detailed, you need to step back and look at the big picture. 80/20 rule. Create families as far as the products go and use activities that organizationally driven.

   

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