The flow of activity-based costs through the ledger is the same as their flow using traditional methods except that the accounts are based on activities,not departments.

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Activity-based costing (ABC) and traditional costing methods follow the same ledger flow, but ABC uses activities as a basis for accounting instead of departments. The cost distribution and allocation process is still similar in both methods, with costs eventually reaching the final product or service for which they were incurred.

The Flow of Activity-Based Costs Through the Ledger Is the Same