Editing Activity-based costing (section)

==Application==
ABC has proven its applicability beyond academic discussion.{{citation needed|date=December 2016}}

ABC
*is applicable throughout company financing, costing and accounting:
*is a modeling process applicable for full scope as well as for partial views.
*helps to identify inefficient products, departments and activities.
*helps to allocate more resources on profitable products, departments and activities.
*helps to control the costs at any per-product-level level and on a departmental level.
*helps to find unnecessary costs that may be eliminated.
*helps fixing the price of a product or service with any desired analytical resolution.

A report summarizes reasons for implementing ABC as mere unspecific and mainly for case study purposes<ref>[http://www.meditari.org.za/docs/2007v2/2%20Sartorius,%20Eitzen%20&%20Kamala%20%20art%208%20-%20Vol%2015%20No%202%202007.pdf The design and implementation of Activity Based Costing (ABC): a South African survey]  {{webarchive|url=https://web.archive.org/web/20110813050421/http://www.meditari.org.za/docs/2007v2/2%20Sartorius%2C%20Eitzen%20%26%20Kamala%20%20art%208%20-%20Vol%2015%20No%202%202007.pdf |date=13 August 2011 }}</ref> (in alphabetical order):
* Better Management
* Budgeting, performance measurement
* Calculating costs more accurately
* Ensuring product /customer profitability
* Evaluating and justifying investments in new technologies
* Improving product quality via better product and process design
* Increasing competitiveness or coping with more competition
* Management
* Managing costs
* Providing behavioral incentives by creating cost consciousness among employees
* Responding to an increase in overheads
* Responding to increased pressure from regulators
* Supporting other management innovations such as TQM and JIT systems

Beyond such selective application of the concept, ABC may be extended to accounting, hence proliferating a full scope of cost generation in departments or along product manufacturing. Such extension, however requires a degree of automatic data capture that prevents from cost increase in administering costs.