Activity-Based Costing (ABC) in Service Industries Case Study - 1

Activity- base Costing (ABC) in Service Industries - reason Study Exampler that the Amazon.com Company is a verified technology leader it has developed electronic commerce innovations such as personalization of shopping services and easy-to-use search and browse features (Anderson & Young, 2001). Shopping at Amazon.com is unbendable and safe, incorporating a simple ordering system, secure credit card transactions, and e-mail communication with customers and direct exaltation internationally.The Internet is an increasingly significant global medium for online commerce. The Companys headquarters are base in the Seattle, Washington. The Amazon.com firm successfully accomplished its initial civic offering in the mid-month of the year 1997 and its everyday stock is listed on the Nasdaq National Market under the symbol AMZN. In many ways, Amazon.com is perhaps the caller-out that is most closely tied with the E-Commerce phenomenon. The fraternity has grown from a bookseller to a fund amental Wal-Mart of the website selling products as diverse such as Music compact discs, game applications, software and apparatus and hardware. The company has as well as grown at a steady rate with revenues rising from about one hundred meg dollars in 1997 to three billion dollars in 2001 (Anderson & Young, 2001). However, the rise in revenue has led to a agree augment in operating losses making the company to run a great deficit. The company did make its first quarterly profit of five million dollars in the fourth quarter of 2001. Unfortunately, this was do to decline by vital cumulative losses.Great economists first defined the concept of Activity Based Activity in the late 19th century in that period. Originally, the ABC was focusing on the manufacturing perseverance where the technical upgrading and output upgrading had reduced the quantity of express labor and the material costs, though there was an increase in the percentage of indirect or overhead cost.In contrast to the traditional cost account statement system, the activity based cost systems originally