Then click on the icon to download FREE Adobe Acrobat PDF reader software. As part of its initiative to use performance based program budgeting to improve program efficiency, the Florida Legislature requires agencies to report their unit costs.
Unit costs are the costs of producing an output or outcome.
These costs can be calculated in a number of ways, the most common of which are the direct costs of producing one unit of output and allocated costs, using a methodology that assigns indirect or overhead costs to each unit. Direct, indirect, and allocated costs provide important information for managers and policy makers, and the type of cost data used depends on the purpose of the analysis. Direct costs that are separated from indirect costs are most useful for budgeting purposes and privatization decisions. However, cost comparisons are best done with allocated costs. The categories that agencies are using to report costs are useful for budgetary purposes.