Posts Tagged ‘cost driver’


Customer Profitability: A One Way Street

Accountants love to tick and tie numbers, and sometimes become insanely excited when their numbers balance. This insanity is to their advantage when they are providing their “Control” function. In case others reading this article don’t know, accountants have multiple roles or functions in business. One is “Control” – Make sure money and assets are […]

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Activity-Based Cost: More Than Numbers

Activity-Based Cost or ABC has gained wide acceptance as a modern cost methodology incorporating cause and effect and cost visibility. ABC provides relevant information for management decision making. However, some have criticized ABC for a singular focus on cost and profits. This criticism is misguided. While Activity-Based Cost does have a strong cost base, it […]

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Fake Cost Drivers for Administrative Overhead

A recent discussion in an online cost modeling forum related to “Which cost drivers can you use to assign administration overheads to a wide product range in a manufacturing concern.” As the discussion evolved, one response said “it is best done through the driver of turnover of the product produced. … because the efforts of […]

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Hidden Money in Your Business: Ask Four Questions to Find It

Recently, a friend told me he could not attend a professional meeting relevant to his job because of an across the board travel ban. Whenever I hear of a company mandating across the board cuts in travel or any other specific item on their financial statement, I know that the company has no clue about […]

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Five Sure Fire Ways to Kill a Wonderful Business

Only five ways? Well, there must be more than a hundred sure fire ways to kill a wonderful business. But let’s start with five.

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Where to Find Cost Savings

As a financial controller, one of my responsibilities was to find cost savings opportunities. My route was to look at the financial statements or general ledger results. Usually this was the wrong place to start looking. As I thought about it, I realized that numbers in the general ledger were results and I needed to […]

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