Activity Accounting

"The ability to achieve and sustain enterprise excellence requires the deliberate and continuous improvement of all activities?not just manufacturing?within an enterprise. "

"Traditional cost accounting systems provide little information on the sources of competitive advantage."

"Activity accounting identifies activities performed in an organization and determines their cost and performance."

"Activity accounting mitigates against the misuse of resources that usually is associated with cross-subsidized allocation."

"When the fight for market share in a stable or declining market intensifies, managers must specialize in the most profitable product or service rather than increased sales volume."

"Activities are defined in terms of the information elements necessary to perform them and to create their output."

"Activities transcend all steps within the chain of value?product design, manufacturing engineering, production, distribution, marketing, and after-sales service. "

"Activity analysis decomposes a large, complex organization into elemental activities that are understandable and easy to manage."

"Activity accounting doesn't answer whether an activity should be performed or if it could be performed more effectively."

"Activity accounting improves the accuracy of product costing by tracing activities to products on the basis of usage."

"An activity analysis is a communication tool that provides a set of structured information about what an enterprise does."

"An activity cost is the total expense of all traceable factors of production assigned to perform an activity."

"Activities provide the basis for costing"