Activity Based Costing for wastewater treatment and reuse under uncertainty: A fuzzy approach

Abstract

The objective of this article is to present a methodology for computing and allocating wastewater recuperation costs using an Activity-Based Costing (ABC) methodology. One of the most critical problems in modelling those costs is the limited information and the subjectivity used to represent some of the cost's elements (e.g., values, drivers, among others). Thus, a fuzzy ABC approach is incorporated into the methodology to overcome those limitations. The application of this methodology aims at providing an alternative procedure to allocating the costs related to wastewater management activities to products. To validate the proposed methodology and illustrate its utility, a case study using data from a bus assembly plant is provided. Part of the wastewater produced is coming from a surface treatment installation which, after a recovery process, reuse part of the same water in a closed loop circuit. Using the proposed Fuzzy ABC methodology, the costs (including uncertainty) of the surface treatment and water treatment activities can be appropriately allocated to the products that generate those activities and that waste.