Activity-Based Costing (CPE Course)

CPE Credit: 3 hours

Course Type: Downloaded PDF materials with online test

Price (with PDF Textbook): $30

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Course Description
A business can find itself in severe financial difficulties if it is making decisions based on incorrect overhead allocations. This has become more of a problem since overhead has become such a large proportion of total costs. Activity-Based Costing provides the solution by clearly stating a methodology for assigning overhead costs, and the circumstances under which it is most useful. The course also describes every type of overhead cost and how mis-allocations can occur. In addition, it gives practical advice for setting the scope of an activity-based costing project and improving the odds of project success.

Author: Steven Bragg

Course number: AC1130

Learning Objectives:

  • Recognize the differences between direct costs and overhead costs.

  • Specify how overhead can be mis-allocated in different operating environments.

  • Describe the allocation problems associated with a single allocation base.

  • Describe the processing steps used in activity-based costing.

  • Specify the differences between primary and secondary cost pools.

  • Identify instances in which the refresh rate for activity drivers can be delayed.

  • Describe the different types of activity drivers that can be found within a business.

  • Specify the contents of a bill of activities.

  • Recognize the allocation treatment for the different types of administrative costs.

  • Identify the situations in which additional cost pools and activity drivers should be added.

  • Specify the advantages and disadvantages of activity-based costing.

  • Describe the circumstances under which activity-based costing can be most beneficial.

Level: Overview

Instructional Method: QAS Self-Study

NASBA Category: Accounting

Prerequisites: None

Advance Preparation: None

Program Registration Requirements: Click on "Purchase Course" near the top of this page to pay for and access the course. You will then be able to download the course as a PDF file, then take an on-line examination, and then download a certificate of completion if you pass the examination.

Program Refund Policy: For more information regarding administrative policies concerning complaints, refunds, and other matters, see our policies page.


AccountingTools, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have the final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website:

The NASBA sponsor identification number for Accountingtools, Inc. is 115881.

AccountingTools is an IRS Approved Continuing Education Provider. We are compliant with the requirements for continuing education providers (as described in sections 10.6 and 10.9 of the Department of Treasury’s Circular No. 230 and in other IRS guidance, forms, and instructions). Our IRS Approved Continuing Education Provider number is 72821.