Activity Based Costing (ABC) has been recommended as an alternative to traditional cost allocation methods due to its ability to provide more accurate costing of products/services. The adoption of ABC has however received a mixed reaction in terms of its adoption by organisations.Assume that you are a group of management accounting trainees working in a manufacturing organisation with multiple products and your supervisor is considering the adoption of ABC in your organisation. You have been asked to prepare a report for your supervisor that meets the following requirements. Undertake research of the literature (academic and professional) and provide a report that outlines the experience (positive and negative) of organisations over the past ten years following the adoption of ABC. Based on your research provide a recommendation to your supervisor on whether ABC should be adopted in your organisation.
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