Which of the Following Statements Is True Regarding Activity-Based Costing

question 95

Multiple Choice

Which of the following statements is true regarding activity-based costing in administration?

• A) The principles of ABC are different when applied to administrative services.
• B) ABC in administration involves five steps.
• C) All cost drivers in an administrative system will be time-related.
• D) Activity-based costing for administrative services follows the same four-step procedure described for manufacturing.

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Definitions:

Skydiving Experience

Skydiving experience covers the activities, sensations, and emotions associated with performing a parachute jump from an airplane.

Physical Object

An item that can be seen and touched, possessing physical characteristics such as shape, volume, and mass.

Service

The action of helping or doing work for someone, often referring to activities performed in exchange for payment that do not result in the ownership of tangible goods.

Marketing

The business process of identifying, anticipating, and satisfying customers' needs and desires through the creation and exchange of value.