Which of the Following Statements About Activity-Based Costing (ABC) Is

question 133

Multiple Choice

Which of the following statements about activity-based costing (ABC) is not true? (CIA adapted)

• A) In ABC, cost drivers are used to link costs to products.
• B) ABC is useful for assigning marketing and distribution costs.
• C) ABC differs from traditional costing systems in that products are not cross-subsidized.
• D) ABC is more likely to result in major differences from traditional costing systems if the firm manufactures only one product rather than multiple products.

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Definitions:

Price of a Good

The amount of money required to purchase a specified quantity of a product or service.

Normal Goods

Goods for which demand increases as the income of the consumer increases.

Tablets

Portable computing devices featuring touchscreens and offering a wide range of applications.

Incomes of Tablet Users

The earnings or revenue associated with individuals who use tablets, potentially examined for market research or demographic studies.