EVALUATING A FEE STRUCTURE FOR A NOT-FOR-PROFIT COMMUNITY FOUNDATION: A CASE STUDY ON ACTIVITY BASED COSTING

摘要

A case is presented that focuses on a not-for-profit organization offering multiple services whilehaving a costing base which is essentially fixed. At issue is determining a fee structure for theservices provided. The organization is a community foundation which acts as custodian anddisburser of several endowments designated for differing purposes.An activity based costing (ABC) analysis is employed in an attempt to provide decision-relevantproduct (endowment)-level information, providing an approach for allocating costs to productswhen costs are not directly or easily traceable to the products.