Answer the Following Questions Using the Information Below

question 154

Multiple Choice

Answer the following questions using the information below:
Cannady produces six products. Under their traditional cost system using one cost driver, SR6 costs $168.00 per unit. An analysis of the activities and their costs revealed that three cost drivers would be used under the new ABC system. The new cost of SR6 was determined to be $178.00 per unit.
-The total amount of indirect costs assigned to product SR6 using the traditional method is ________ the total amount assigned using ABC.

• A) more than
• B) less than
• C) equal to
• D) more accurate than

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Definitions:

Chairs Repaired

A metric indicating the number of chairs fixed or restored to their original condition, often used in furniture repair businesses to track productivity.

Performance Report

A document or tool that evaluates and details the performance of an entity, project, or employee against expected or predefined objectives.

Activity Variances

Differences between planned activity levels and actual activity levels, often analyzed in managerial accounting to control costs.

Customers Served

The number or segment of consumers who have been provided with products or services by a business within a specific timeframe.