Which Statement About Costing Systems Is True

question 118

Multiple Choice

Which statement about costing systems is true?

• A) Due to technology and mass production, labour related allocation bases are sometimes considered arbitrary.
• B) Traditional costing systems use a three stage cost allocation process.
• C) Labour related allocation bases should never be used in service organisations.
• D) Activity based costing does not use machine hours or other volume based allocation bases.

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Definitions:

Empirically Measure

To quantify or measure based on observation or experience rather than theory or pure logic.

Logical Statements

Propositions that convey reasoning and can be analyzed as true or false based on logic.

Systems

Organized sets of interrelated elements or components that function together as a whole to achieve a particular goal or handle specific tasks.