One Difference Between a Traditional Costing System and an ABC

question 78

Multiple Choice

One difference between a traditional costing system and an ABC system is:

• A) An ABC system allocates overhead to units of goods or services
• B) An ABC system has more cost pools and more cost drivers
• C) An ABC system traces direct materials to units and considers them to vary with volume
• D) Information from an ABC system can be used for GAAP

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Definitions:

Medical Expenses

Costs for healthcare services, treatments, surgeries, and preventive care deductible under certain conditions on personal tax returns.

Periodic Payments

Regularly scheduled payments, often associated with loans, annuities, or settlements, that occur over a period of time.

Divorce Agreement

A divorce agreement is a legally binding document outlining the division of assets, debts, and other obligations between spouses upon the dissolution of their marriage.

Above-the-line Deduction

Deductions from gross income that are made before the calculation of taxable income, directly reducing the gross income amount.