The First Step in Activity-Based Costing Is to

question 38

Multiple Choice

The first step in activity-based costing is to

• A) assign overhead costs to products, using overhead rates determined for each cost pool.
• B) compute the activity-based overhead rate per cost driver.
• C) identify and classify the activities involved in the manufacture of specific products, and allocate overhead to cost pools.
• D) identify the cost driver that has a strong correlation to the activity cost pool.

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Definitions:

Financial Advantage

The benefit or gain, often in terms of money or economic value, that a person or entity receives, often through investments, business operations, or other means of increasing wealth.

Positive Adaptation

The process of adjusting to new conditions in a way that maintains or enhances well-being or effectiveness.

Resilience

The mental capability to adapt and bounce back quickly from adversity, trauma, tragedy, or significant sources of stress.

Stressors

External or internal factors that cause stress, challenging an individual's ability to cope and potentially affecting their health and well-being.