An activity cost pool is an aggregate of all the costs associated with performing a particular business task, such as making a particular product. … An activity cost pool includes both fixed and variable costs and is a temporary account, used only to get an idea of how much a certain activity costs a business.

How do you assign an activity cost pool?

Activity Cost Pools Defined One such technique is activity-based costing. Activity-based costing systems allocate manufacturing overhead by assigning indirect costs to activity cost pools, then dividing each cost pool by a cost driver to obtain the rates used for allocation.

What are examples of cost pools?

A cost pool is a grouping of individual costs, typically by department or service center. Cost allocations are then made from the cost pool. For example, the cost of the maintenance department is accumulated in a cost pool and then allocated to those departments using its services.