Cost system under uncertainty: A case study in the imaging area of a hospital

Abstract

An activity-based costing (ABC) system is based on the premise that activities consume resources and cost objects (e.g. products and services) consume activities. The development of effective costing systems requires a good design of processes and activities. But some business and production systems can be characterized by high levels of uncertainty. In the particular case of hospitals, the amount of resources consumed for the same type of examination by two different patients can be completely different, which may hinder costs and to bias the process of budget planning. This paper presents an ABC costing model for the imaging area of a hospital, including the uncertainty of the processes. A Monte Carlo simulation was made and interesting results were obtained. The probabilistic ABC costing model is a tool that can be used to improve decision making.