What Is the Primary Drawback to Using a Volume-Driven Base,such

question 54

Multiple Choice

What is the primary drawback to using a volume-driven base,such as direct labor or machine hours,to apply overhead to products in a traditional cost accounting system?

• A)The cost accountant may not fully understand how to track direct labor or machine hours.
• B)It is difficult for an AIS to incorporate such a measurement into its system.
• C)It is difficult for an ERP to incorporate such a measurement into its integrated system.
• D)Many overhead costs are incorrectly allocated to products since they do not vary with production volume.

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Definitions:

Brainstorming

A collaborative idea generation technique aiming to solve a problem or generate creative solutions without immediate criticism.

Researching

The act of systematically investigating and studying materials and sources to establish facts and reach new conclusions.

Gatekeeper

An individual or entity that controls access to something or decides who gets access to resources or information.

Rambling Monologue

A lengthy, often tedious speech made by a single person, lacking a clear focus or endpoint, which can lead to listener disengagement.