What are Batch-Level Activities?

Batch-level activities are those actions related to a defined cluster of units. The concept is most commonly used in the allocation of overhead costs to production or service activities. The assignment of costs at the batch level is intended to more precisely associate costs with units produced, so that the items can then be priced to maximize profitability and avoid a loss.

Example of Batch-Level Activities

Here are several examples of batch-level activities:

Production run setup. The cost to set up a production run is assigned to the units produced as a result of that setup. This represents a tightly-targeted cost allocation.
Paint booth activities. A cluster of identical parts from a production run is painted as a batch within a paint booth. The cost to conduct the painting operation is then allocated to each unit in the batch.