Asked by Connor Covert on Apr 28, 2024
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Activity rates are computed by dividing the cost budgeted for each activity pool by the estimated activity base for that pool.
Activity Rates
The estimated activity cost divided by estimated activity-base usage.
Cost Budgeted
An estimate of costs for a project or business over a specific period, forming the basis for financial planning and performance measurement.
Activity Pool
A way to assign costs in cost accounting, grouping all the cost inputs associated with a specific activity.
- Understand the fundamentals of activity-based costing and how activity rates are computed.
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Learning Objectives
- Understand the fundamentals of activity-based costing and how activity rates are computed.
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