Activity-Based Costing (ABC)systems Allocate Overhead Differently Than Traditional Cost Accounting

question 37

Multiple Choice

Activity-based costing (ABC) systems allocate overhead differently than traditional cost accounting systems.The difference between an ABC and a traditional cost accounting system is that

• A) traditional systems calculate several overhead rates, one for each manufacturing activity.
• B) an ABC system uses a single allocation overhead rate.
• C) ABC systems calculate several overhead rates, one for each manufacturing activity.
• D) a traditional cost accounting system uses two overhead allocation rates: one for actual activity and one for estimates (or standards).

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Definitions:

Cellular Respiration

The metabolic process in which cells obtain energy by consuming oxygen and yielding carbon dioxide, typically involving the breakdown of glucose to produce ATP.

Undigested Food

Material that has passed through the digestive tract without being broken down into nutrients that can be absorbed by the body.

Regulation

Regulation refers to the control or maintenance of various biological processes at both cellular and organism levels, ensuring stability and proper functioning within living systems.

Integration

The process of combining or coordinating separate elements so as to provide a harmonious, interrelated whole, often used in contexts of neural and systems integration.