The First Step in Activity-Based Costing Is to

question 45

Multiple Choice

The first step in activity-based costing is to

• A)assign manufacturing overhead costs for each activity cost pool to products.
• B)calculate the activity-based overhead rate per cost driver.
• C)identify and classify the major activities involved in the manufacture of specific products.
• D)identify the cost driver that has a strong correlation to the activity cost pool.

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Definitions:

Organizational Resources

Refers to the assets, including human, financial, and physical, that an organization can utilize to achieve its objectives.

Customer Group

A specific segment of the market targeted by a company's products, services, or marketing efforts.

Strategic Leadership

Leadership that focuses on long-term success through visioning, planning, and fostering an environment conducive to adaptation, innovation, and growth.

Guardian of Trade-offs

A role or principle involving the management and balance of competing interests or resources in decision-making processes.