The Cost Object(s) of the Activity-Based Costing Method Is(are)

question 82

Multiple Choice

The cost object(s) of the activity-based costing method is(are) :

• A) The unit of product.
• B) The production departments of the company.
• C) The production activities of the company.
• D) The production activities in the first stage and the unit of product in the second stage.
• E) The unit of product in the first stage and the production activities in the second stage.

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Definitions:

Adjusted Net Income

Net income adjusted for specific expenses, revenues, gains, or losses to provide a clearer picture of operational performance.

After-Tax Net Income

The amount of profit left over after all expenses, including taxes, have been deducted from total revenue; represents the bottom line for a company.

Cost Method

An accounting approach used for investments where the investor has little to no influence over the investee, recording the investment at cost and recognizing income only when dividends are received.

Elimination

In accounting, the process of removing intercompany transactions and balances from the financial statements of a group of companies consolidated as one entity.