Cost Allocation for Business Process Simulation Models

Barber, Kevin; Dewhurst, Felicity; Pritchard, Matthew Charles

doi:10.1243/09544054jem379

Cited by 4 publications

(2 citation statements)

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“…where, b1, b2, …, bn are constants. Theorem (2.1) [1]: If the function ℋ n (𝔱)is the derivative of the function ℋ(𝔱) then its Novel transform is defined by the following where Table 1 shows the summary of novel transformation:…”

Section: Basic Definitions and Properties Of Novel Transformmentioning

confidence: 99%

“…Traditional cost calculation methods adopted by organizations typically assign expenses to each department based on their incurred costs within the year, often neglecting an analysis of departmental profitability [1,2]. An alternative method, Activity-Based Costing (ABC), has been applied with some success, but it presents challenges in linking costs between activities and products, and lacks scalability [3,4].…”

Section: Introductionmentioning

confidence: 99%

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Optimizing Budget Allocation Through First-Order Linear Differential Equations and Innovative Transform Techniques

Albukhuttar,

Alshamkhawii,

Kadhim

2023

MMEP

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The resolution of a first-order mathematical system effectively tackles a wide range of physical problems. The technique illustrates that the quantity of authorised variables in the system may be depicted by the activities that need to be evaluated for cost, and that the system takes into consideration the connections between these costs. Mathematical systems adhere to primary conditions, resulting in derived solutions that are specific and reliant on a single independent variable representing the temporal aspect in cost computation. This enables the forecast of costs in future years. This study confronts the inadequacies found in traditional cost allocation methods used for organizational budgeting, often leading to a biased allocation of costs to departments, irrespective of their profitability. We introduce an innovative method that employs first-order linear differential equations to model the cost dynamics associated with various activities within an organization. Moreover, an innovative transformation technique is presented to solve these equation systems efficiently, thereby enabling a precise computation of activity-based costs over a three-year projection. The results illustrate that the proposed method provides a more precise and insightful budget allocation, suggesting potential applications for financial planning and management across diverse sectors.

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Section: Basic Definitions and Properties Of Novel Transformmentioning

confidence: 99%