Presence of a predisposing condition - Predisposing conditions include peptic ulcer disease, acute appendicitis, acute diverticulitis, and inflamed Meckel diverticulum. Indeed, acute appendicitis is still one of the common causes of bowel perforation in elderly patients and is associated with relatively poor outcomes.
(2) Two-Stage Allocation: It can be observed that both the costing systems follow a two stage allocation procedure. In traditional costing, in the first stage, overhead costs are allocated to production departments. But in ABC, in the first stage, overhead costs are assigned to each major activity and not to departments.
The distinction between job costing and process costing hinges on the nature of the product and, therefore, on the type of production process: 1  Process costing is used when the products are more homogeneous in nature. 2  Process costing systems assign costs to one or more production processes.