Activity-Based Costing

question 53

Multiple Choice

Activity-based costing

• A)is an accounting system that assigns a company's expenses to whichever activity in a company's value chain is responsible for creating the cost.
• B)involves using benchmarking techniques to develop cost estimates for the value chain activities of each major rival.
• C)is a powerful tool for identifying the different pieces of a company's value chain and classifying them as primary activities and support activities.
• D)involves determining which value chain activities represent variable costs and which represent fixed costs.
• E)is a tool for identifying the activities that cause a company's product to be strongly differentiated from the products of rivals.