Advantages of Time Driven ABC Include

question 11

Multiple Choice

Advantages of time driven ABC include:

• A) idle time can be quantified as input costs minus costs assigned to activities
• B) standard rates can be used in quotations
• C) regression analysis is not required
• D) a and b

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Definitions:

Low Risk Projects

Investments or projects that are considered to have a lower probability of resulting in a financial loss.

Investor Risk Aversion

The tendency of investors to prefer lower-risk investments to avoid potential losses.

WACC

Weighted Average Cost of Capital, a calculation of a firm's cost of capital in which each category of capital is proportionately weighted.

Appropriate Discount Rate

The rate used to discount future cash flows to their present value to account for risk and time value of money, reflecting the opportunity cost of capital.