What Sometimes Makes Implementation of Activity-Based Costing Difficult in Service

question 42

Multiple Choice

What sometimes makes implementation of activity-based costing difficult in service industries is

• A)the labelling of activities as value-added.
• B)identifying activities, activity cost plus, and cost drivers.
• C)that a larger proportion of overhead costs are company-wide costs.
• D)attempting to reduce or eliminate non-value-added activities.

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Definitions:

Opportunity Cost

Represents the value of the best alternative that is forgone when a decision is made.

Unit(s)

The fundamental measurement or quantity of a good, service, or economic variable used as a standard or baseline for transactions, assessments, or calculations.

Toys

Objects designed for play or amusement, often targeted towards children.

Heckscher-Ohlin Model

A model in international trade theory that explains patterns of trade between countries based on their differences in factor endowments.