COMPARATIVE STUDY ON THE DETERMINATION OF COSTS AND RESULTS UNDER THE TERMS OF USE OF ABC METHOD AND METHOD OF CALCULATION ON ORDERS

Between the method on orders, as a method of traditional calculation and the ABC method there are a few similarities, but also distinctions. Both methods include in the cost of the product direct costs, while indirect costs are repaired by using a two-step allocation system. Thus, in the traditional...

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Bibliographic Details
Published in:Analele Universităţii Constantin Brâncuşi din Târgu Jiu : Seria Economie 2019-06 (3), p.98-103
Main Author: BUȘAN GABRIELA
Format: Article
Language:English
Subjects:
ABC method
method of calculating on orders
production cost
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Summary:Between the method on orders, as a method of traditional calculation and the ABC method there are a few similarities, but also distinctions. Both methods include in the cost of the product direct costs, while indirect costs are repaired by using a two-step allocation system. Thus, in the traditional system indirect expenditures are distributed on products using no more than two absorption bases (hours-work and/or machine hours), while ABC systems use multiple partition bases (number of operations, number of orders, etc.). As a result, ABC's repartition bases will impose more real production costs, especially where indirect expenditure holds a higher share.
ISSN:1844-7007
1844-7007