Each of the Following Is a Limitation of Activity-Based Costing

question 35

Multiple Choice

Each of the following is a limitation of activity-based costing EXCEPT that

• A)it can be expensive to use.
• B)it is more complex than traditional costing.
• C)more cost pools are used.
• D)some arbitrary allocations continue.

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Definitions:

Income Mobility

The ability of individuals or families to move up or down the economic ladder within a lifetime or from one generation to the next.

Income Ladder

A metaphorical representation of the distribution of income across individuals or households in a society, indicating levels of wealth or poverty.

Quintile

A statistical value that divides a group of data into five equal parts, each containing 20% of the population.

Transfer Payment

Payments made by governments to individuals without any goods or services being exchanged, such as social security benefits.