Activity-Based Costing (ABC) Is a Costing Technique That Uses a Two-Stage

question 6

Multiple Choice

Activity-based costing (ABC) is a costing technique that uses a two-stage allocation process. Which of the following statements best describes these two stages?

• A) The costs are assigned to activities, and then to the products based upon their use of the activities.
• B) The costs are assigned to departments, and then to the products based upon their use of activity resources.
• C) Service department costs are allocated to the production departments, and then to the products based upon their use of the activities.
• D) Indirect costs are assigned to activities, and then to the products based upon the direct cost resources used by the activities.

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Definitions:

Motor Nervous System

The motor nervous system is a division of the peripheral nervous system that controls voluntary muscle movements.

Sensory Nervous System

The part of the nervous system responsible for processing sensory information from the external and internal environment, sending it to the brain for interpretation.

Autonomic Nervous System

The part of the nervous system responsible for controlling involuntary body functions, like heart rate, digestion, and breathing.

Somatic Nervous System

A part of the peripheral nervous system that controls voluntary movements of the body and transmits sensory information to the central nervous system.