A Major Advantage of Activity-Based Costing (ABC) Is That It

question 21

True/False

A major advantage of activity-based costing (ABC) is that it reduces unit cost distortions arising from overhead allocations that often occur using traditional cost accounting systems.

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Definitions:

Equivalent Ratio

A way to express the same relationship or proportion between two quantities, although the numbers involved may differ.

Equivalent Ratio

A proportional relationship between two quantities showing how many times one value contains or is contained within the other.

Ratio

A ratio is a quantitative relationship between two numbers showing the number of times one value contains or is contained within the other.

Ratio

A ratio represents a quantitative relationship between two or more numbers, showing how many times one value contains or is contained within the other.