To read this content please select one of the options below:

(excl. tax) 30 days to view and download

What does it really cost? Allocating indirect costs

Herbert Snyder, Elisabeth Davenport

The Bottom Line

ISSN: 0888-045X

Article publication date: 1 December 1997

6369

Abstract

Better managerial control in terms of decision making and understanding the total costs of a system or service result from allocating indirect costs. Allocation requires a three‐step process of selecting cost objectives, pooling related overhead costs, and selecting costs bases to connect the objectives to the pooled costs. Allocation may be simple, relying on a single base, or activity‐based costing (ABC), relying on multiple bases. Contrasts the methods of allocation, and argues that ABC may be more useful for costing electronic services.

Keywords

Citation

Snyder, H. and Davenport, E. (1997), "What does it really cost? Allocating indirect costs", The Bottom Line, Vol. 10 No. 4, pp. 158-164. https://doi.org/10.1108/08880459710183035

Publisher

:

MCB UP Ltd

Copyright © 1997, MCB UP Limited

Related articles