Authors: Narcyz Roztocki
Addresses: School of Business, State University of New York at New Paltz, 75 South Manheim Boulevard, New Paltz, NY 12561, USA
Abstract: This paper examines the implementation of the Integrated Activity-Based Costing and Economic Value Added System in the service sector. This system is intended for use by those service companies for which the traditional costing system is not adequate. Motivations for tracing overhead costs as well as capital costs, using the integrated system, are discussed. Resulting improvements in the reliability of product cost information are illustrated through the example of a consulting firm, which moved from intuitive cost estimation to reliable cost analysis. Finally, the impact of this integrated system on the service sector|s decision-making process and long-term business performance is discussed.
Keywords: activity-based costing; consulting companies; economic value added; service companies; ABC.
International Journal of Services Technology and Management, 2003 Vol.4 No.4/5/6, pp.494 - 506
Available online: 24 Sep 2003 *Full-text access for editors Access for subscribers Purchase this article Comment on this article