In the First-Stage Allocation in an ABC System, Some Costs

question 269

True/False

In the first-stage allocation in an ABC system, some costs may be allocated to a special cost pool that are not subsequently allocated to products or customers.

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Definitions:

Capital

Financial assets or the financial value of assets, such as funds held in deposit accounts and/or funds obtained from special financing sources.

Debits

Accounting entries that increase assets or expense accounts, or decrease liability, equity, or revenue accounts.

Credits

Accounting entries that increase liabilities or equity accounts, or decrease asset accounts.

Personal Equipment

Tangible items owned by an individual for personal use, not for business or commercial purposes.