ABC Focus is a software solution based on activity based costing methodology. In ABC there are six distinct aspects to the costing.

The cost objects are things like products or services from which income is derived. These items are sold at a price which in order to make a profit must be higher than all the costs involved in making them marketable commodities.

The cost object is the end product. In the background there are multiple Activities using Resources and incurring costs necessary to produce these Cost Objects. So on the one hand there are the cost objects that are income producing. On the other hand are all the Activities that use the Resources and incur the costs. Activity based costing steps match up these two.

Remember it is the activities that use the resources so one needs to determine what the firms activities are. The Activities of the organization are the Cost pools. The Resources these cost pools use ie the cost of the resources such as materials, expenses, and people are the Cost lines. For both Activities and Resources there is something that triggers their need or drives their usage. With Activities this trigger is known as the Cost driver and with Resources its the Resource driver. Therefore to build a costing model you must know what Objects you want to cost, which Activities and Resources make these objects and how the Drivers influence their usage.