Robustness to Measurement Errors and Diversity in Resource Sharing in Time-driven Activity-based Costing

The total cost error and the costing system robustness were influenced by measurement errors under different resource sharing patterns. According to the analysis of Time-Driven Activity-based Costing calculation process, we propose the cost error models for variables of unit time and quantity to increase the costing system sensitivity to errors for the aspects of diversity studied, analyze the robustness to measurement errors under different resource sharing patterns. We also identify conditions where allocating costing system limited resources to cases characterized by high diversity in resource sharing patterns is detrimental to improve cost accuracy.