ABC Can Be Used in Routine Planning and Control Decisions

question 40

True/False

ABC can be used in routine planning and control decisions as well as pricing, product mix and cost cutting decisions.

---

Definitions:

Equipment

Tangible assets used in operations, such as machinery or office machines, which have a useful life longer than a year.

Straight-Line Method

A depreciation method that allocates an equal amount of the cost of an asset to each year of its useful life.

Fully Depreciated

A term used when a fixed asset has been depreciated to its salvage value and no longer carries a cost on the balance sheet except its possible residual value.

Loss on Disposal

Represents the financial loss a company incurs when it disposes of an asset for less than its carrying value.