Having ERP Will Let a Company Use More Cost Allocation

question 49

True/False

Having ERP will let a company use more cost allocation bases.

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Definitions:

Sales Mix

The proportion of different products or services that a company sells, influencing overall sales and profitability.

Variable Costing

An accounting method that only considers variable costs (costs that change with production volume) when calculating the cost of goods sold and in the determination of profitability.

Absorption Costing

An accounting method that includes all direct and indirect manufacturing costs in the cost of a product.

Net Income

Net income is the total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.