Please make sure you are using a supported browser. To find out more click here.

Jun 2010

Time estimates as cost drivers

This research studies the determinants of measurement error in time-driven costing to obtain an observable true cost benchmark that can assess the error in a costing system.

The first part of the study looks at the level of aggregation in the cost system’s definition of activities.

The second part examines different task environments (job design) where tasks present themselves in a coherent or incoherent order.  

Part three looks at the notification that participants will need to provide time estimates after performing a set of activities, and finally there is an investigation into whether providing time estimates in percentages versus in absolute time units (e.g. minutes) has an effect on accuracy.

Time estimates as cost drivers