It Is Easier to Allocate Indirect Costs to the Products

question 258

True/False

It is easier to allocate indirect costs to the products that actually caused those costs if an ABC system is used rather than a traditional costing system.

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Definitions:

Personal Property

Assets belonging to an individual that are movable, excluding real estate or land.

Fines Paid

Monetary charges imposed as a penalty for breaking laws or regulations, generally not deductible for tax purposes.

Deductible

An expense that can be subtracted from gross income to reduce the amount of income subject to tax.

More-Than-50% Business-Use Test

A criterion used for determining whether an asset is used primarily for business, requiring that over 50% of its use is for business to qualify for certain tax deductions.