Term
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Definition
| An event that causes the consumption of overhead resources. |
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Term
| Activity-Based Costing (ABC) |
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Definition
| A two-stage costing method in which overhead costs are applied to products on the basis of the activities they require. |
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Term
| Activity-Based Management |
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Definition
| A management approach that focuses on managing activities as a way of eliminating waste and reducing delays and defects. |
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Term
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Definition
| A "bucket" in which costs are accumulated that relate to a single activity measure in an activity-based costing system. |
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Term
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Definition
| An allocation base in an activity-based costing system, ideally, a measure of whatever costs in an activity cost pool |
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Term
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Definition
| A predetermined overhead rate in activity-based costing. Each activity cost pool has its own activity rate which is used to apply overhead to products and services. |
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Term
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Definition
| Activities that are performed each time a batch of goods is handled or processed, regardless of how many units are in a batch. The amount of resources consumed depends on the number of batches run rather than on the number of units in the batch. |
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Term
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Definition
| A systematic approach to identifying the activities with the greatest room for improvement. It is based on comparing the performance in an organization with the performance of other, similar organizations known for their outstanding performance. |
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Term
| Facility-Level Activities |
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Definition
| Activities that are carried out regardless of which products are produced, how many batches are run, or how many units are made. |
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Term
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Definition
| Activities that arise as a result of the total volume of goods and services that are produced, and that are performed each time a unit is produced. |
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