Is a Name for a System That First Accumulates Overhead

question 19

Multiple Choice

is a name for a system that first accumulates overhead costs for each of the activities of an organization, and then assigns the costs of activities to the products, services, or other cost objects that caused that activity.

• A) Transaction- based accounting
• B) Transaction costing
• C) Cost- driver accounting
• D) Activity- based costing

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Definitions:

Assets

Resources owned or controlled by a business, entity, or individual, with future economic value that can be measured and expressed in financial terms.

Externalities

Effects a project has on other parts of the firm or on the environment.

Cash Flow Estimation

The process of forecasting the cash inflows and outflows over a specific period, vital for budgeting and financial planning.

Cash Flows

The complete volume of financial transactions in and out of a business, crucially influencing its cash on hand.