The Only Difference Between a Volume-Based Cost System and an ABC

question 46

True/False

The only difference between a volume-based cost system and an ABC system is how the methods assign indirect costs to products.Both systems trace direct costs to products;the only difference is how they treat indirect costs.

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Definitions:

Coffee Shop

A type of retail establishment that primarily serves coffee and other beverages, along with snacks or light meals.

Assignment

A transfer of rights, property, or responsibilities from one party to another.

Assignee

A person, company, or entity to whom rights or interests have been transferred by another, known as the assignor.

Liabilities

Obligations that a person or company owes to others, often in the form of debts or other financial commitments.